This article first appeared in City & Country, The Edge Malaysia Weekly on March 18, 2024 - March 24, 2024

Mulpha International Bhd has kept a low profile after divesting its stake in Mulpha Land Bhd (now known as Thriven Global Bhd) in 2015. It subsequently slimmed down its property portfolio in Malaysia, keeping only the Leisure Farm township in Johor. It still holds a 22.18% stake in Thriven Global.

Since then, it has focused its activity in Australia on key assets such as Sanctuary Cove and Norwest City. Acquired in 2002, the 1,171-acre Sanctuary Cove is an integrated resort-style residential development in Gold Coast, Queensland, that is complemented by two golf courses, harbours, dining offerings and the InterContinental Sanctuary Cove Resort.

Mulpha International acquired the 931-acre Norwest Business Park located in Sydney’s The Hills Shire district in the 1990s. In 2017, the company announced plans to redevelop the property into a smart city called Norwest City.

The company also has a hospitality arm with a portfolio that includes InterContinental Sydney, InterContinental Sanctuary Cove Resort and InterContinental Hayman Island Resort.

Just before the Chinese New Year festivities, City & Country managed to catch up with its CEO Greg Shaw, who was on a one-week business trip to Malaysia, and general manager Marc Lee, at the company’s new office in Menara Mudajaya in Mutiara Damansara. Shaw and Lee share their plans for Leisure Farm, and talks about their venture into hospitality technology.

Mulpha International has always maintained long-term foresight when it comes to its investments, whether they are in Malaysia or abroad, says Shaw. “Mulpha International is quite a unique real estate business because we have had very good long-term foresight in our investments. We have made significant investments across a range of key assets that have been with the business for a long time. In all of our key assets, we have bought large parcels of land. We have seen long-term strategic value in that land, and we have developed those over quite an extensive period of time.

“As a business, we are very much at this lifestyle end of the market. Even before the pandemic, we saw that people value having places that have great lifestyle benefits. In a lot of ways, we are pioneers in that market with Sanctuary Cove and Leisure Farm. We like to think Leisure Farm is always going to be a sanctuary for people with many lifestyle benefits [with the availability of] a golf course, recreational facilities and health club, among others.

“We’ve seen that many people are finally understanding the strategy that we developed 20 years ago. In the last five to six years, people have seen that [good] quality of life, facilities and residential components are crucial to having a sustainable lifestyle,” says Shaw.

The company sees the distressed market as an opportunity, having bought larger strategic investments during the downturn where interest rates were higher.

Shaw cites the Covid-19 pandemic as a perfect example: “We had been trading in InterContinental Sydney at 93% occupancy in 2019. We needed to do renovations at some point, but it was quite difficult for us to make the decision to close the hotel. When Covid-19 emerged, we instantly decided that we were going to undertake the renovation. We spent A$120 million on refurbishment and finished renovation in 2021. [Post-Covid], we came out with a brand-new hotel and have seen it trade brilliantly ever since.”

Another example would be the acquisition of Sanctuary Cove. “We bought Sanctuary Cove in the early 2000s out of a receivership and not a lot of people saw the value in that property. We were quite bold in buying it from a receivership and it has been one of the best investments Mulpha International has ever made.”

First introduced in 1991, Leisure Farm is a 1,765-acre freehold township with a gross development value of RM2.5 billion in Gelang Patah, Johor. It currently has 1,029 residential units and an estimated population of 2,500 from 38 nationalities.

Through the years, Leisure Farm has capitalised on the opportunities presented by government initiatives to turn Johor into an economic powerhouse. They include the Malaysia-Singapore Second Link bridge in 1998 and the establishment of Iskandar Malaysia, which aims to attract foreign direct investment into the state.

Mulpha International has not been introducing new launches in the township, with the latest being Bayou Creek and Residensi Bayou in 2012 and 2019 respectively. As the developer has about 500 acres of undeveloped land bank, Lee says it is in discussions on what to introduce next in the township.

“We want to share the message and present Leisure Farm as an option for people to choose how they want to live their ideal life. This is a key part of our renewed mission post-Covid. We are preparing for a lot more stimulus and ramping up more activities in Johor — possibly more than what we have seen in the last 10 years.

“The future will include possible new lifestyle offerings. We are trying to understand what lifestyle points are important to people nowadays. Those points of difference are something that we have been working on for a long time, and we’re conceptualising and studying them very closely for the residential sector. In the commercial sector, it will be more about health and wellness, which has become increasingly important. In short, we are staying extremely vigilant with our plans and incorporating what we have learnt and done in Australia,” he says.

Exciting activities have been brewing in Johor in the past year, including the announcement of the Special Economic Zone, the Special Financial Zone, the proposed LRT project and the possible revival of the Singapore-Malaysia High Speed Rail.

Lee believes that certain initiatives by the government to ramp up Johor’s economy will certainly bode well for Leisure Farm. He explains that the catalytic projects being carried out in the southern state will have a spillover effect on Leisure Farm and naturally attract people to the township.

He believes that a revived and friendlier version of the Malaysia My Second Home programme and the progress of the Johor Bahru–Singapore Rapid Transit System (RTS) station will help to stimulate a renewed interest in foreign direct investment as well as migration into Johor.

“Additionally, we are also expecting the completion of the Gerbang Nusajaya Interchange soon. We have partnered with UEM Sunrise Bhd and this has been in construction and development for a long time,” says Lee.

Adjacent to Leisure Farm, the interchange will facilitate a shorter commute time for travellers to and from the Malaysia-Singapore Second Link.

“With the rise of inflation, rentals and [cost of] homeownership in Singapore, there are compounding factors that make Johor more viable,” Lee enthuses.

Mulpha International is also strengthening its hotel operations by venturing into hospitality-related technology. “One thing we saw [in hotels] is that they were quite slow in innovation when it came to technology. They were using about five different software products for labour productivity, housekeeping, maintenance and handling guest requests. None of them were connected,” Shaw points out.

“In the age of digital transformation, surely there [should be] software that can fully integrate all that. We spent about two years searching for a product that had the potential to drive significant innovation and cost-savings in hotels.”

In that process, the company found 14 software programmes that could do just that. After testing the programmes, a Spanish company called Hub OS came out on top. “We love the product and we put it to the test in our hotels,” Shaw enthuses.

Since implementing the software into its hotel operation, Mulpha International has seen an increase in labour efficiency. The software allows housekeepers to access rooms by scanning a QR code hidden in the door seal with their phone and report any maintenance faults found.

“If the television is broken, the housekeeper then logs on to the app and reports the defect. The report will automatically go to the maintenance team, and they will automatically know what the problem is and tend to it,” Shaw further explains.

More than optimising labour efficiency, the software allows the hotel operator to examine the number of maintenance jobs done in the hotel.

“In the course of a month, we have all the data in the system, [such as] how many times the television has broken down. Through that system, the hotel operator becomes much more efficient [in understanding] where the maintenance team spends its time, what the issues are in the hotel and how to think of strategic maintenance for those issues. The hotels become much easier to understand. It’s taking efficiency to a whole new level,” shares Shaw.

Following that, Mulpha International announced a joint venture with Hub OS in 2021 and obtained the rights for the product throughout Australia and Asia.

“We’re talking about really bringing that product in a big way into Malaysia because it is quite transformational in terms of driving efficiency and profit in hotels,” says Shaw.

Moving forward, Mulpha International will continue its tried-and-true strategy of long-term investment.

“We will continue to play to our strengths in real estate development and investment. If we look at what we’ve done in the past, a lot of strategic investments from the past are only maturing now. We will continue to look for long-term strategic investments where they can complement our [core] business,” says Shaw.

Furthermore, there are opportunities for the company to delve into the fund management business as well. “In the past, Mulpha International has [undertaken investments] on its own balance sheet. Increasingly, we are now seeing people approaching us and telling us that they would like to co-invest with us. While we provide our expertise, they provide the investment.

“I think there’s a significant opportunity for us in fund management as a business where other sophisticated investors use our expertise and our capabilities. That really opens a lot more opportunities for us as a business,” Shaw notes.

Meanwhile, Lee clarifies that while regional expansion in real estate development and investment remains on the books for the company, it is making a selective decision on what the next investment opportunity will be.

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