HAVING entrenched itself in the construction industry, main board-bound Crest Builder Holdings Bhd is eyeing property development, particularly in selected locations in the Klang Valley.
The company, which is also going upstream in the production of building materials and steel fabrication business, has been on the lookout for property development projects to be undertaken on a joint-venture basis with government or private landowners in the Klang Valley.
We are in negotiation with a landowner to jointly turn a piece of land into a high-end condominium project. We expect to finalise the deal in a month or two, Crest Builder group managing director Yong Soon Chow told StarBiz.
He said this in conjunction with the group's listing on the main board of the KLSE via a reverse takeover of MGR Corp Bhd.
According to Yong, by having joint development with landowners Crest Builder will cut down on capital cost as well as eliminate the need for holding costs.
I believe we will have no problem selling our properties now as long as they are in good locations. We will go for medium to high-cost houses of good designs and quality landscaping so that the house buyers will get value for their money, he said.
Given the right opportunity, Yong said, the group would acquire land banks for its own property development purposes.
The group's property development arm is its subsidiary Crestland Development Sdn Bhd.
On the company's plans to diversify into the manufacture of building materials, Yong said it planned to produce bricks and mild steel and to acquire a steel fabrication factory later this year.
We will also go into quarrying but it is still in the initial stage and we are talking about producing bricks for our company's construction and property development needs, he said.
Although 90% of the company's contracts are derived from government and quasi-government projects, Yong hopes to reduce its dependence on such work.
We shall try to increase our private sector projects by between 25% and 30% next year as we are actively going to bid for more tenders locally and maybe overseas, especially in the Commonwealth countries where we stand a better chance because of the similarity in terms of the way of doing business and administration, he said.
The group has targeted India and Australia as the possible countries for infrastructure development like roads and bridges.
Yong said Crest Builder would capitalise on its expertise in specialised projects, including beach nourishment and island formation works, water circulation and airport apron control tower.
Other specialised projects completed by the company included the Damansara Specialist Hospital and Ampang Puteri Specialist Hospital.
The company had recently completed a RM40mil beach nourishment project in Pantai Kok in Langkawi.
Beach nourishment is the construction of tiny islands off the coast of the island to prevent beach erosion. We beautify the sea by planting trees on the islands, he explained.
On competition from medium-sized construction companies, Crest Builder director Alex Kam said the company would be relying on its strong balance sheet and proven track records to win as many contracts as possible.
Even though we are considered a small-cap company, we are fundamentally strong and we are in the business for the long haul with firm plans for future expansion.
Going forward, we are confident of being able to sustain growth and achieve our targets, Kam said.
According to Kam, the company will leverage on its position as a listed company to bid for tenders locally.
We see the government farming out more priority projects despite the current economic situation because it is holding back on non-essential development, he said.
Crest Builder has a workforce of 100 people including 30 civil, mechanical and electrical engineers and 20 quantity surveyors.
Although most of the construction projects undertaken by the group are concentrated in Selangor, it also has construction projects in Penang, Perak, Johor, Negri Sembilan and Pahang.