For a development outfit void of a family attachment, its history dates back to 1983 when the brand IJM was created by the merger of IGB Construction Sdn Bhd, Jurutama Sdn Bhd and Mudajaya Sdn Bhd. The purpose was simply to compete on a better footing against both domestic and foreign construction players. It wasn’t until April 2007 when it acquired RB Land Group to form IJM Land and succinctly gained a wider presence in the built industry. But it was to be the worst of times due to the Global Financial Crisis in 2008 where the market dwindled and sales plummeted.
It was during these struggling months when the outfit discovered that the property market is a slow one to change, cyclical and inclined towards the mid-tier. Before long, the company was back in business after 2009 with projects swiftly taken up. But with a merger, how would it have been in terms of staffing and culture?
“I think in terms of culture, both sides of the companies are actually quite professionally run,” says Dato’ Soam, Managing Director and CEO of IJM Land Bhd.
“The other good thing is that geographically, some of the locations where IJM Properties were operating versus where RB Land was operating, there’s no conflict. So like in Penang, RB Land don’t have any operations there and like in Negeri Sembilan, in Melaka, IJM don’t have any operations there.
“In Sarawak, they don’t have any operations there (IJM Properties). In Sabah, RB Land don’t have any operations there. So it’s a good mix.”
The merged entity came out stronger than they were individually and instead of bickering over reporting lines, territories and designation titles like most other mergers, IJM Land Bhd shines like a brand new locomotive, with a renewed engine and body of 300-men strong. Six years later today, it is a 550-men team. In terms of financial numbers, revenue doubled to over RM2 billion in 2014 from 2010 while profit before tax surged from RM148 million in 2010 to RM701 million in 2014. Dato’ Soam was however quick to point out that it is no one man’s glory, instead he commended the team for pulling it together.
It is with such humility that he has been driving the company as part of the team rather than sitting atop as the common and instructive boss. He prefers diligence and credits hard work as necessary in both the running of a professional career and company.
His open door policy also welcomes fellow peers and colleagues to speak their minds. Admittedly, not all opinions are taken but with a deeply entrenched knowledge about the business and knowing which pulse mattered, he could better call the shots for the betterment of the company.
The Malaysian Prowess
From the public’s view, one can truly attest to the IJM prowess. Its projects stretch from all corners of Malaysia and even East Malaysia with the exception of only Kelantan and Terengganu.
“We are truly a Malaysia developer.”
In what he coined as a property “supermarket”, offering everything from residential to industrial, IJM is there to meet the different palates including overseas products in Vietnam, China and London.
“London is a matured market, it’s a bit different from us. Of course the system there is a bit different, it is more tilted towards the build-and-sell method. So you need to have actually deep pockets to be able to do more developments there. And you need to be very sure because being a matured economy, everything is done very systematically and very transparent. So the planning process can be a bit lengthy.”
Undaunted by the requirements, Royal Mint Garden in London has sold more than 95%. In fact, documentation, processes and transparency are among IJM’s strengths as it was awarded a top ten ranking within the Asean public listed fraternity for its Corporate Governance Index in 2014. It also won the same accolades a few times prior. And though tedious such reporting culture may seem, Dato’ Soam is unfettered as IJM is one that recognizes such value. So the question is, would he recommend such a professional play to other companies?
“I think you need a lot of discipline and a lot of team work. You must have a team that wants to make it happen. Like I said, no one can do this on his own. You as a leader only can provide the direction and vision but you need team work for people to make it happen.
“You must know how to encourage the people to make it happen.
“You can buy people with money for a short period of time but after that what? People rather go, they’ve got dignity. They’ve got dignity, they won’t stay with you, they won’t help you to improve the company anymore. This is something very important I learnt from day one when I started my service in the government.”
In terms of operations, he clarifies that the company is run with business plans, key performance index, budgets and risks assessment.
“Six months before the financial year end, we will start preparing our budget for next year taking into considerations market condition, market sentiment, market outlook and then also you need to look at the risks.
“Of course everyone wants the company to fly overnight but to me more important is sustainable growth.”
An Enlarged Sheet
As a matter of strategy, IJM Land Bhd will soon be returning to its parent’s fold at IJM Corporation Bhd.
“We are exchanging for shares in IJM Corporation. So you get to continue to participate in the assets of IJM Land through IJM Corp.
He cites the 64% owned by IJM Corporation and most of the outstanding shares are held tightly by funds limiting its flexibility in the market.
“So the free float in the market is not that big.
“By participating in IJM Corporation, there’s a bigger free float in the market so the shares are easily tradable.
“By being in IJM Corporation, IJM Land will immediately be able to play with a bigger balance sheet.”
As a business, Dato’ Soam understands that there are things beyond anyone’s control but opines that the key to success lies in its execution such as delivering as planned and having the right departments to do the right things. Branding is also essential.
Other criteria include committed to fixing the defects as they come, team work and being customer focused.
As far as the market goes, he reckons it will be buoyed by the younger population of below 30 years old and Kuala Lumpur will continue to enjoy inward migration. Penang on the other hand shall inherit those from the north. As for property type, he shares that the landed properties in Klang Valley will continue to be hot in time to come and that’s the proposition of projects like Bandar Rimbayu. Despite the possible slowdown post-GST, he is adamant the market exist and will return within six to nine months.
For Dato’ Soam, who is also the Deputy President of REHDA (Real Estate Housing Developers’ Association), success on the report card just goes down to hard work, processes and team work. But when asked what’s his definition of true success is, “It’s when people want to come and see you and want to work with you.”
Some of IJM’s Projects
The Light Waterfront, Penang, GDV RM6 billion.
Pantai Sentral Park, 58 acres iconic project, GDV RM2.5 billion.
Bandar Rimbayu, 1,900 acres township, GDV RM11 billion.
Seremban 2, 2,300 acres, GDV RM2 billion
Sebana Cove, 1,100 acres, RM3 billion.
Royal Mint Garden, London, GDV RM1.38 billion.
IJM’s Overall Overseas Experience – India, United Arab Emirates, China, Indonesia, Singapore, Australia, Orlando USA.
This formidable company can be found on the web at www.ijmland.com.
By Ivan Tan