Wednesday 24 Apr 2024
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KUALA LUMPUR (Dec 4): To ensure a more sustainable future for itself, Sime Darby Property Bhd (SDP) has initiated a change in its growth strategy. 

In a virtual interview with The Edge, group managing director Datuk Azmir Merican talks about how SDP — the country’s largest developer by land bank — has embarked on a mission to transform itself from a pure-play property developer focusing on the residential segment into a real estate development company by end-2025.

The idea behind the move is to diversify its revenue streams so that it is not dependent on the business of building and selling alone to carry it forward.

“We need to keep in mind that while we may have the biggest land bank today, this might not be the case tomorrow. As a property developer, we can’t keep developing and selling land as it is a finite resource,” Azmir says.

Hence, the need for SDP, which is 58.4%-owned by Permodalan Nasional Bhd, to increasingly broaden its recurring income through new ventures.

“As a property developer, you build and sell. As a real estate development company, we are talking about owning estate and real estate and leasing [them] out to generate long-term income. That is the fundamental difference,” Azmir says.

“When we look at other more mature economies, including Singapore, this is how property [development] companies have evolved. I think this is the right direction, and we are the first [in Malaysia] to pivot in this direction. I’m sure more will follow.”

Azmir, who is passionate about sustainability, also talks with much enthusiasm about the company’s plans to reinvent run-of-the-mill terrace homes, and ultimately, put out its first sustainable township — potentially as early as 2030.

He also gives his views on whether home prices are on the way up, given the rise in raw material costs.

Read our interview with him in the Dec 6 issue of The Edge Malaysia weekly.

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