IN a bid to reshape its long-term growth profile, Land & General Bhd
(L&G) has entered the industrial property development business, with the first phase of its planned industrial park in Selangor estimated at close to RM1bil.
Approximately 2,500 acres of land will be developed in Sungai Jernih, Selangor, which the company has owned for more than three decades. According to managing director Low Gay Teck, the land is in the final stages of being rezoned for industrial use, with an initial phase of 238 acres.
“We have submitted the entire 2,500 acres of land for industrial park development and are in the final stage of council approval,” he told StarBiz 7 in a recent interview.
Low describes the project as a strategic milestone for the group, marking its foray into the industrial segment after focusing on residential townships and high-rise developments for years.
The first phase will comprise vacant industrial plots of one to two acres, detached factories, semi-detached factories and larger hybrid units.
The location offers strong logistical advantages, being less than 4km from the Lembah Beringin toll plaza and directly linked to the North-South Expressway (NSE).
“It’s only a five minute drive to the NSE, so that is a major plus point,” Low said.
He added that the site drew interest during pre-marketing, aided by the presence of neighbouring developments such as Chery Automobile’s assembly plant.
“We have engaged with potential investors to gauge their feedback on the location, and the general response has been quite positive,” he said.
Based on preliminary layouts, Low expects Phase 1 to generate a gross development value (GDV) of RM800mil to RM1bil.
“For phase one, the GDV should easily be between RM800mil and RM1bil,” he shared.
He explained that the size of the development is influenced by industrial assets, where individual factories command high ticket prices.
“We are also selling detached factories, priced at RM10mil to RM20mil.”
A key advantage for L&G is the extremely low book value of the land, which was acquired more than 30 years ago during the early development of Lembah Beringin.
“The holding cost is under 50 sen per sq ft,” Low said.
In terms of capital expenditure, he reckons it will easily amount to between RM150mil and RM200mil.
“We will need to pull in the utilities, for both Phase 1 and Phase 2 so it doesn’t cost us more,” he added
While the group will face substantial upfront costs for land conversion and infrastructure development, including roads, water, electricity, and gas, Low believes margins will remain compelling.
“I would say the margin will be attractive,” he said.
Even with conversion premiums and infrastructure spending for the initial phase, he says it remains financially favourable due to the low land base.
“Margins will be even higher than our property development projects.”
The industrial park is expected to start contributing to earnings from financial year ending March 31, 2028 (FY28), becoming more meaningful in FY29.
“FY29 will be more meaningful in terms of contribution from the industrial park,” Low says.
Initially, industrial development is expected to account for about 10% of earnings.
“If you start off with 10%, that’s good,” he said.
Over the longer term, however, residential projects will remain the backbone of the group.
“Our bread and butter residential development component will still hold at least 50% to 60%,” Low said.
The industrial diversification comes at a time when L&G’s financial performance is already accelerating.
For the second quarter ended Sept 30, 2025, the group posted a more than six-fold increase in net profit to RM14.07mil on revenue of RM132.83mil, driven mainly by higher contributions from its property division and improved results from joint ventures.
The education segment also delivered steady growth.
For the six months to end-September, net profit surged four times to RM25.48mil on revenue of RM231.29mil.
Unbilled sales stood at RM622.23mil, providing strong earnings visibility into the near and medium-term.
Low said the current construction cycle is at full pace.
“We have unbilled sales of RM622mil as of end-September. All these three projects are progressing at maximum capacity. So it will not slow down for the next 15 months.”
Despite the industrial push, L&G continues to deepen its residential pipeline.
For FY26, the group plans to launch projects with total GDV of more than RM700mil, including a 1,008-unit serviced apartment development in Bandar Sri Damansara with GDV of RM651mil, and the final phase of Sena Parc in Senawang.
In Bandar Sri Damansara, the design caters to larger households.
Beyond FY26, L&G is planning more than 3,000 apartment units at The Mines Resort & Golf Club, a high-end condominium project in Mont’Kiara, and the U10 Aria Rimba township in Shah Alam, which is expected to have a total GDV of about RM2.6bil.
L&G also operates private and international schools under the Bestari brand in Sri Damansara, contributing about 15% of group revenue.
It is also expanding into hospitality through the conversion of its former Menara L&G office tower in Putrajaya into serviced apartments.
With a landbank of 2,815 acres and net gearing of about 0.2 times, Low believes the group can fund its expansion.
If executed as planned, the Sungai Jernih industrial park could unlock long-dormant land value while adding a high-margin, recurring development stream to complement L&G’s residential engine, positioning the company for more diversified growth over the next decade.
