Property
Busy times ahead for OSK Property
Ang Hui Hsien 
Harbour Place in Butterworth is currently on its sixth phase called Luminari
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OSK Property Holdings Bhd CEO Ong Ghee Bin could not have joined the company at a more exciting time.

After an illustrious career at Sunway City Bhd spanning 25 years, he joined OSK Property in 2015 – the same year the latter delisted from Bursa Malaysia and merged with the property arm of PJ Development Holdings Bhd (PJD).

Needless to say, Ong had his work cut out for him. One of his first major tasks was to combine the two companies’ property teams into one structure and group their projects under one name.

“That’s why we – and all our projects – are now parked under the OSK Property brand. As far as the working team goes, it is all a one team kind of mindset,” he says.

OSK Property is a wholly-owned subsidiary of OSK Holdings Bhd, which is controlled by executive chairman Tan Sri Ong Leong Huat.

The launch of Melbourne Square’s phase one has generated quite a buzz in the Melbourne market

Under the new brand, the developer recently launched the first phase of mixed development Melbourne Square in Australia, which is also its first overseas venture.

 

Things are expected to get busier in the coming months with three launches lined up, namely Ryan and Miho in Petaling Jaya, Iringan Bayu in Seremban and the last phase of You City in Cheras.

 

Across the sea

With a total gross development value (GDV) of RM9 bil, Melbourne Square occupies 2.02ha near the city’s central business district.

The size of the site allows OSK Property to incorporate multiple components such as residences, retail, offices and a hotel – something which is uncommon to the Melbourne scene.

The developer also worked closely with the city council on the planning and design of a public park which will be perched atop the development.

“In Melbourne, you cannot find a land of such size, so this parcel has allowed us the opportunity to create an integrated development which is different from the standalone apartments or offices which is the norm there,” he says.

The project has proven to be a hit, as evident from the successful launch of its first phase comprising two apartment blocks – the 67-storey East Tower and 52-storey West Tower – early last month which generated quite a buzz.

Targeted for completion in 2020, the first phase carries a GDV of A$927 mil (RM3 bil) and includes 1,043 units going from A$401,200 to A$5.8 mil.

To-date, it has registered a 55% take-up rate from purchasers in Australia and Southeast Asian countries, including Malaysia, Indonesia and Singapore as well as China and Hong Kong.

“In terms of the number of units sold, we are talking of over 500 which is very encouraging when compared to other developments with only 300 units or less. If you look at it from that perspective, it is actually very good,” says Ong.

Phase one also includes the retail component, which has already garnered interest from two of the biggest supermarkets in Melbourne.

Ong says the launch of future stages, which include a hotel and office tower, will depend very much on the market. “The entire development depends on the market’s take-up rate. There are six towers in total, so we are also looking at the other components and deciding when to move them to the market,” he says.

Raine and Horne International Zaki and Partners Sdn Bhd partner James Tan commends the developer’s move to broaden its sales revenue by venturing outside of Malaysia.

“They have diversified their developments by expanding overseas to Australia, which is a good move given the current uncertain socio-economic situation here,” he says.

In terms of the prospects of Malaysian developers in the Australian market, PropertyGuru Malaysia country manager Sheldon Fernandez believes they stand a good chance of achieving success.

“Property prices in Australia’s main cities are still comparably lower than that of Asian markets [Singapore, Hong Kong and China], thus there seems to be an opportunity for Malaysian developers to expand their forte overseas,” he shares.

 

Upcoming launches

Following Melbourne Square, OSK Property’s attention will return to home ground with the upcoming launch of Ryan and Miho.

The residential project consists of two 30-storey towers of 1,084 serviced apartments sitting on 2.4ha in the matured neighbourhood of PJ’s Section 13.

It derives its name from the Turkish and Japanese languages, with Ryan meaning oasis and Miho translating to beauty.

Despite the lack of promotions save for a billboard near its sales gallery, the project – which is currently open for registration – has attracted a fair bit of interest from the local community.

Ong attributes this to the established status and maturity of the area, as well as its lack of available land and new developments. “If you are from the surrounding areas, this is a development you would look at. Otherwise, you’ll have to look at all the other old developments,” he points out.

The developer is also set to launch the final phase of its 8.09ha integrated development You City in Cheras.

 

Prime land

The Hika serviced apartments occupy what Ong describes as the most prime land within the development due to its direct link to the Taman Suntex Mass Rapid Transit (MRT) station.

Also open for registration is the first phase of Iringan Bayu in Seremban featuring double-storey terraced homes called Pastura.

The entire 311.6ha township carries a GDV of RM3.6 bil, and borrows its name from the Malay language which translates to “The Accompanying Wind”.

Taking centre stage is its 8.9ha central park which will offer recreational opportunities as part of the township’s emphasis on green community living.

Ong reveals Iringan Bayu will be targeted at those who live in Seremban and commute daily to their workplace in the Klang Valley.

“When you say Greater Klang Valley, that’s where Iringan Bayu comes into the picture. Nowadays, many people stay in Seremban and work in the Klang Valley, so the former is one spot we’ve identified as a growth area,” he explains.

Raine and Horne’s Tan believes the new developments bear good prospects, though he cautions these may be marred by several factors facing the property industry.

“I think they will do well given the special and unique features of these projects although the current very challenging environment, especially the looming oversupply situation [in the high-rise sector] and difficulty in getting bank loans, may impact sales,” he says.

 

Giving what the market wants

Apart from the three new projects, OSK Property is also in the midst of planning for its current land bank totalling about 1,295ha and RM14 bil in GDV.

Most of the developer’s current land bank is located in the Bandar Puteri Jaya township in Sungai Petani, Kedah

Most of these are located in Sungai Petani, Kedah where the developer has a township called Bandar Puteri Jaya.

 

“We have been there for many years. The whole land is about 2,400 acres [971.2ha] and we have not even finished half of that,” reveals Ong.

The developer also owns the remaining land in its Harbour Place project in Butterworth, Penang. The township is currently in its sixth phase comprising 34-storey serviced apartments called Luminari.

“We are here because we see that these are the growth areas, so the focus will still be in these locations at the moment,” says Ong.

He adds, “We are not restraining ourselves to just doing residential. We are just very careful of what the market needs at this point in time.”

This careful approach also extends to its land along Jalan Ampang in the KL city centre, where the headquarters of the OSK Group sits.

Ong admits they are in the midst of exploring the development potential of the parcel of land, although everything is still on the drawing board.

“That piece of land is very prime, especially with an MRT station coming up right next door which will be integrated into the existing Light Rail Transit system.

“We want to be very careful with what we’re going to put up there, and there are a lot of possibilities we’re exploring, but we have not come to a final conclusion,” he says.

With the current market shift towards affordable housing, Ong states that OSK Property already has a presence in this segment, having completed 1,400 1Malaysia Housing Programme homes in Bandar Puteri Jaya.

The upcoming Ryan and Miho are also priced from around RM500,000 – relatively affordable for its location – while Iringan Bayu will also be priced in the same range.

“So you see, we are already doing that and are consciously targeting that segment for our new projects,” states Ong.

PropertyGuru’s Fernandez says with affordable housing being of national importance, it is welcoming to note that more developers are hopping onto the bandwagon to develop projects geared towards first-time home buyers.

“In terms of performance of other projects in segments, there will always be upgraders or individuals looking for investment properties that are able to fulfil demand from other segments of the market,” he says.

 

Strengthening its assets

Internally, Ong has also been overseeing the implementation of new work processes, which involves inculcating a learning culture. “As an organisation, we believe the way to grow and move forward is to learn from each other’s success and mistakes,” he says.

This is facilitated by a know-ledge management portal which allows staff to upload reports and training to be shared and accessed by their colleagues.

The developer also introduced best practices and guidelines on project do’s and don’ts and enhanced its delivery system.

Committees were formed to monitor construction progress and audit projects on a monthly basis to track areas that have improved and need improving, which are later shared with the project team.

“We have what we called the spirit of excellence, where after a project is finished, a site visit is organised a few months after, during which the project team will share their experience and lessons with the other teams,” says Ong.

He adds they also embarked on a property-construction collaboration, with the construction arm of OSK Group serving as builders of four projects, allowing them more control over the project timeline and quality.

While Ong admits they still encounter challenges every now and then, he notes these measures have already proven to be effective with projects ahead of schedule and improvements in terms of quality and the teams’ working culture.

“It’s basically building up the foundation for the whole business unit and getting the people to be in alignment on all these best practices and what should be done so we can move to the next level,” he adds.

 

Finding his calling

OSK Property Holdings Bhd CEO Ong Ghee Bin may have been in the property development industry for the most part of his career, but it was not his first choice.

Armed with a degree from the University of Malaya, the civil engineering graduate found a job as a civil and structural consultant in a local firm. It didn’t last long however, as he left 4½ years later after realising consultancy was not for him.

The way to grow and move forward is to learn from each other’s success and mistakes, says Ong

It was in 1989 when he secured a job with the property division of the then-expanding Sunway Bhd, marking the start of a tenure lasting over two decades which saw him rising through the ranks.

Ong remains grateful to his previous employer for the experience and exposure he obtained, not just in property development but in investment assets as well.

He counts himself lucky for being given the opportunity to manage and run different types of projects such as a shopping mall and hospital, noting that the property development sector encompasses much more than just residences.

This holistic experience has made him a valuable addition to OSK Property, particularly at a time of a major corporate exercise.

Since his appointment as CEO in November 2015, Ong has been streamlining the work process of two formerly separate teams under a merged entity and aligning their interests – efforts which have shown positive results despite only being implemented for a short time.

There will be no time for rest in the coming months as OSK Property pushes ahead with several new launches, but Ong is more than ready to take up the challenge.

Going beyond building

OVER the past year, OSK Property Holdings Bhd has embarked on several corporate social responsibility (CSR) efforts centred on the three thrusts of the OSK Foundation – environmental, community and education.

One of these initiatives involved collaborating with social organisation Epic Homes, where 35 OSK Property staff helped build a house in just three days for a family of seven at an orang asli settlement in Gopeng, Perak.

Around the end of last year, the developer also jointly initiated a clean-up of Balok Beach in Kuantan, Pahang with the Turtle Conservation Society of Malaysia and the Pahang branch of the Malaysian Nature Society.

In conjunction with the effort, OSK Property and OSK Foundation pledged to donate RM3,000 each to both associations in support of their projects on environmental education and turtle conservation.

In total, 368kg of waste were collected by staff from the OSK Group, schoolchildren, university students as well as representatives from non-governmental organisations from a 1km stretch of public beach fronting OSK Property’s TimurBay sales gallery and Swiss-Garden Resort Residences.

OSK Property also found a way to incorporate its CSR efforts into its rebranding exercise following its merger with the property arm of PJ Development Holdings Bhd.

It partnered with GreenTech Malaysia Alliances and Kloth Lifestyle for a Waste to Wear campaign which involved turning 12,500 used plastic bottles into the new OSK Property uniform – on average, 8.5 plastic bottles went into the production of each T-shirt.

Through this initiative, OSK Property became the first developer to receive a partnership programme certificate from GreenTech Malaysia Alliances for its effort to support sustainable corporate transformation under the waste management initiative.



This article first appeared in Focus Malaysia Issue 258.