On a fine Wednesday morning, I arrived at Wisma Mah Sing in Jalan Sungai Besi, Kuala Lumpur. I have passed this road many times but I didnt realise that the building is there all these while. But that is no big deal. What’s more important is for me to calm myself down. My heart is pounding and my palms are sweaty. There is a sense of restlessness in me as I am tasked to interview one of the country’s wealthiest men Mah Sing Group Bhds chief executive officer Tan Sri Leong Koy Hum.
I am not sure what to expect. He could be fierce and strict, I think to myself. And as I wait for the man of the hour, many possibilities came to mind. Seconds later, Leong clad in a dark suit heads towards my way.
Then he started talking and all my assumptions flew out the door. I find him to be so friendly and down-to-earth so much so, it feels as if I am talking to a long-lost distant uncle. There is a special kind of warmth he exudes and as we started chatting, Leong shares his success secrets in life and what is the key for longevity as a developer.
When Leong was in his 20s, he had a big dream. At that age, Leong was a plastic manufacturer. From just one factory, he managed to start another three. “In my 20s, I had this strong feeling to fight for what I want. Every morning, when I opened my eyes, I thought of a better future and a better tomorrow,” says Leong about his younger days. Then at only 35 years old, thanks to his hard work, Leongs plastic company was listed -something he had dreamed of for many years. “I’ve always wanted to achieve that because from there, I can grow my company to be bigger,” he tells.
Leong came from a normal, average family. As a young man, Leong was determined and fully driven to achieve more in life and be a big success. He credits his unwavering tenacity from values like punctuality, cleanliness, courteous and hardworking all of which he had learnt from dealing with his Japanese customers.
“The Japanese portray a lot of good values that even our former Prime Minister Tun Dr Mahathir Mohammad introduced the Look-East policy. Till today, I still adhere to all the good values of the Japanese,” says Leong adding that as one matures he or she will have more good values to carry to help elevate themselves.
As a plastic manufacturer, Leong remembers the long hours he had to put in. But he was able to cope since he was a young blood at that time. “I was a fighter all the way… even though I consider my manufacturing days as a very tough period for me, I eventually learned to adapt to the long hours. There are a lot of things you have to control while in manufacturing and at the same time you have to ensure that there’s a reasonable profit margin of no less than 10 per cent，” he explains.
Despite his dedication to the plastic factories, Leong realized that he had to look for a venture that can provide him a better profit margin but at the same time allows him the space to enjoy a balanced lifestyle. This was what that brought him to the property world. “Actually, the property business is quite similar to manufacturing. There are product development, quality control, marketing, research and development as well as customer service to focus on,” says Leong.
Plus, at that time, Leongs plastic manufacturing business was facing thinning margins and in a bid to protect the shareholders’ value Leong knew he had to forge a new path for Mah Sing. “I felt that this vibrant sector could provide the next impetus of growth for Mah Sing. The rest as they say is history,” Leong says adding that properties have always been viewed as the best hedge against inflation and are one of the most preferred asset classes in Malaysia. Mah Sings plastic manufacturing is still up and running till today. It produces property proprietary products like pallets and furniture.
DRIVE TOWARDS EXCELLENCE
In life, making sacrifices is inevitable. Often, the bigger the sacrifices are, the greater the rewards. For Leong, in the vision for a better future, he had to forgo some important elements, one of which is spending quality time with his family.
“During my manufacturing days, I started working early in the morning and by the time I came back, my children were already asleep. Thinking about it, my only regret is not being able to spend a lot of time with my family when I was younger. And family time is one thing money cannot buy,” Leong shares.
When asked on how he keeps himself motivated, Leong says he is a very determined person. If he plans to achieve something, he will put his mind into it and be positive that he will achieve it.
“Don’t say (this is difficult’. The moment you say this, chances are you will never get around to doing it” he advises.
But his sacrifices seem to pay off well. Today, at 56 year-old, Leong sees Mah Sing as the second largest listed property developer in Malaysia by sales value and the company is also named by market analysts as an emerging proxy to the property development industry. Under his leadership, the property giant has become one of the few fully integrated property developers with high-rise and landed residential, integrated commercial centres and niche industrial parks. Apart from being one of the most sought-after developers, Mah Sing has also been recognised with over 100 local and international awards from various industry groups, media and the public.
Leong credits his love for the job for his success. To him, this love is what drives the desire to excel in the job. “I love creating things. Whenever I see what I plan takes shape, it is like seeing the birth of your baby. It is exhilarating and makes me very happy,” he says.
As the interview progresses, I notices that Leong has quite a bubbly persona. He laughs a lot and once in a while throws in some jokes to light up the conversation. “You have to be humble and mingle with everyone, regardless of their background. By doing so, you can learn from others and this will improve yourself in so many ways,” Leong believes.
So, what makes a company ‘THE，company? To Leong there’s a lot of reasons for that. One of which is having the right talent pool. Leong holds on the idea that with right talents, a developer can passage through any possible paradigm shift.
“Over the years, my focus has not only been on developing the business but on building people too. Right now, there is a need to attract more Gen Y because we are getting older thus succession planning program is vital to ensure a company can sustain and grow. The hardware (building properties) is easy but the software (people running the business) is a completely different story because people are very complex,” says Leong.
Stressing on getting and keeping the right talent pool, Leong believes that a company has to create a strong sense of loyalty. “We want the type of trust where people will keep on coming no matter what. This is an indication that a company has succeeded in treating its employee well,” he cites.
Reflecting on Mah Sings people-management capability, the company has been recognised as one of the best companies to work for by HR Asia Award and recently they have been awarded the Best Company for Leadership Award by IAIR Awards and the Best Managed Company in Malaysia by Euromoney Awards.
THE EVER CHANGING INDUSTRY
After three decades in the property industry, Leong had witnessed many changes in the industry. “Six years ago, higher range properties were all the rage as the supply for higher end (semi-detached and bungalows) made up only 10 per cent of the total residential supply. To meet the market demand from upgraders, many developers launched higher range properties.
“Now, and for the next two years, we believe that the property cycle is pointed at mass market housing. It is a mark of the increasing rise of the middle income class and we are all prepared to meet the demand of this target market,” Leong thinks.
Touching on residential properties, he explains that despite the constant demand for spacious landed properties, there is a segment of the population who do not mind a smaller unit for the sake of living in city centres. Mah Sing has identified such need in the market hence their introduction of M City in Jalan Ampang (that has a thematic hanging garden) and D，Sara Sentral in Sungai Buloh, which is located diagonally opposite an upcoming MRT station.
Another key element in the industry product branding. Leong believes that for a property developer to remain relevant and sustain in the market, it has to find a niche in a crowded market place and this is where the power of product branding and differentiation come into place. Leong explains further, “For example, Gen Y prefers living in the city but property prices in the city are relatively high. So, we develop what they can afford in the city where they get to enjoy the hype of living in city centres. Instead of calling the development of affordable homes, we name it ‘Executive Suites，.”
Leong adds that he often exchanges views with his children who represent Gen Y in an effort to understand what Gen Y wants. To him, understanding how Gen Y thinks is a must and he has no problem adapting to them. What’s more, Gen Y will turn as upgraders as they grow older.
“You have got to adapt and be flexible. Only then, you get to cope with the changes,” says the doting father.
This flexibility is what manoeuvres him in dealing with various challenges in the industry such as the soon-to-be-imposed Goods and Services Tax (GST). Instead of delving on the negative outcome, Leong thinks tt^ buyers will take advantage of the current accommodative interest rate regime. He says that based on experience from other countries, buyers tend to purchase properties in anticipation of the future cost.
“There are several research houses that indicate property demand in the primary market may increase due to this. In fact, CIMB has noted that the overall impact of GST on property sector could be net positive as it may result in inflationary fears and property is seen as an asset to bolster inflation.
“Kenanga Investment Bank viewed that there will be a rush to buy property especially towards mid-late 2014,” Leong tells.
PRESENT DAY AND FUTURE FRONTIER
Leong forecasts that landed residential units in well-planned townships will be snapped up easily, provided that they offer good security, easy accessibility and have a communal focal point. For commercial segment, Leong realises that there is a strong move away from KL City center to suburbs like Petaling Jaya. He reckons that customers in general want integrated spaces because they know that it is no longer enough to have just a row of shops or a block of offices.
“They want projects where the components complement each other, for example, having serviced residences, office towers, hotel or retail mall with each adds vibrancy to the whole project,” he explains.
With emphasis on mass market, he still thinks that demand for luxury residences will remain steady since there is a set of upgraders which comprise of big families who are keen on multi-generational living. And to accommodate the mass market, Mah Sing has made a conscious decision to focus more on medium upper to high-end properties. “With the right product and the right price, we can carve a niche in a crowded market,” says Leong.
A good example is Mah Sings Meridin Suites and Meridin Sovo (Small Office Versatile Office) in Meridin @Medini in Iskandar Malaysia. Meridin Suites offers units with a built-up size of 318sq ft or 885sq ft at a price range of between RM309,000 to RM919,000. Meridin Sovo offers studios and SOVO of one to four room configurations with built-up areas of 341sq ft to l，053sq ft, each priced between RM282,000 to RM924,000.
For the future, Mah Sing aims to continue developing townships and its strategic commercial development. This year, 87 per cent of the company’s target residential launches encompass mainly for mass to mid-segment products and are priced from RMlmillion and below. As for its high-end product, Mah Sing will be directing this segment towards the foreign market. These are the ways Mah Sing adopts to adapt to the current property cycle and it also embodies the developers nature of being market-driven.
LAND BANKS AND POWER OF ACCESSIBILITY
Currently, Mah Sings main focus on land banks continues to be in a few hotspots – Greater Kuala Lumpur (KL) and Klang Valley (KV), Iskandar Malaysia and Johor Bahru as well as Penang and Sabah (Kota Kinabalu particularly) with a remaining Gross Development Value of RM26.82 billion and unbilled sales of RM4.44billion for 2,818 acres.
According to Leong, the government has identified Greater KL and KV as the National Key Economic Area under the Economic Transformation Programme (ETP) where the government aims to grow the population from six million to 10 million people with an emphasis on foreign talent (to grow from 9 per cent to 20 per cent) and creating 553,000 jobs.
“These areas are where the demand is. Other than that, location, products and timing are major factors too. Some of the lands we acquire are in locations that are not traditionally viewed as prime areas, but we have done extensive market studies and found out that with infrastructure improvements we can transform an area greatly,” Leong says.
Usually, Mah Sing will reserve smaller pieces of land for niche products while the bigger parcels are for township development. “Over the past two years, our land banking strategy has been more focused on locking in larger tracks of township lands for the affordable range of mid-end products,” Leong says.
He opines that land is scarce in the city and it is challenging for developers to offer products in the mass market in city centres, which is why more developers are looking for land that caters the middle income market, in suburban locations or building high-rise buildings in the city at expected price point.
Adding to that, Leong feels that with ETP progressing well, suburban locations are becoming more accessible. There is better infrastructure and with public transportation mega projects like the MRT and feeder bus system going on. More well-connected projects will be created. Properties in these projects will gain a lot of popularity because they meet the strong demand for mass market housing.
HOPES AND ASPIRATIONS
Looking forwsrcf, Leong stiff feels that there’s a lot for him to achieve. He is not content just yet. “There’s always room for improvement and I dont see myself slowing down anytime soon. Throughout the years, I learn to keep a lean and mean operation and to always be ready to ride on good opportunities that may come my way,” says Leong.
He is thankful for his diverse team and considers his staff like his own family members. “I cant do everything myself and I greatly value the experience of my people. They have given their all in achieving our dreams,” Leong shares his sentiment.
The business mogul draws his inspiration from people like Dr Li Ka Shing, a Hong Kong-based business magnate who ironically started as a plastic manufacturer too. For him, learning from other people is an ongoing process. “Other than that, it is also important to help others and be kind to one another. Money is not everything… plus when you call it a day, you cant bring your money with you,” Leong says on helping others.
So, what’s next for Leong? For one, he hopes to contribute to the company and the country till he reached 100 years old. In achieving the goal, he takes good care of his health and exercises regularly. “I do almost all types of exercise. Next to my room, I have a gym equipped with all sorts of equipment. This made working out easy for me.
“I still have about 50 years to accomplish more things and I，m excited to see whats next,” Leong says before wrapping up the interview.
• Bandar Meridin East
GREATER KL & KLANG VALLEY
• Southville City@KL South
• Star Residence in Subang
• Lakeville Residence in Kepong
• M Residence 3 in Rawang
• D，Sara Sentral in Sungai Buloh
• Ferringhi Residence
• Southbay City
• KK Convention City