“It will give us long-term value, at least for the next 15 to 20 years. We want to grow at a steady pace with our shareholders,” she says.
There are always at least 10 ongoing projects for KSL, says Lee Feng, noting that it is about having the right products for the various segments.
“We have set a sales target of RM1.6 billion [$504 million] for FY2026 [ending Dec 31] compared with RM1.2 billion in FY2025, which we have already achieved,” she says, adding that the company’s focus remains on affordable, mass housing.
Property development contributed 81% to its total revenue of RM1.38 billion in FY2024, while the other 19% came from property investment. KSL recorded a net profit of RM472.1 million in FY2024, a 13.3% increase from RM416.8 million in FY2023.
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Having been listed since 2002, KSL’s share price experienced a spike recently, reaching a high of RM3.46 on Oct 2. The counter had risen 74% year to date to close at RM2.87 last Thursday, giving the company a market capitalisation of RM3.08 billion.
“That surprised us as well, but it is probably because we started from a very low base. We have been low profile over the years. We stepped up on investor relations since the middle of September, managed to gain some market confidence and attract investor attention. That plus our good track record and low gearing … maybe that was reflected in the share price,” says Lee Feng.
Notably, KSL’s share price started rising after it declared a dividend per share of eight sen in August — the first payout in many years. “This proposed dividend reflects our commitment to delivering sustainable value and rewarding our shareholders for their continued trust and support,” says its FY2024 annual report.
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When asked if KSL will be implementing a dividend policy, Lee Feng says it aims to distribute up to 30% of its core profit.
Generational transition and leadership
Lee Feng, the daughter of group managing director Khoo Cheng Hai @ Ku Cheng Hai, says members of the second generation are actively involved in the company, with plans to focus on shareholder engagement and increase the number of projects and its earnings, as well as investment properties.
As at March 24, the family vehicle Premiere Sector had 31.807% equity interest in KSL, while Cheng Hai, Ku Hwa Seng and Ku Tien Sek had a direct stake of 10.656%, 10.311% and 7.744% respectively.
“We [the second generation] are actively involved but our founding generation is still in control. We are blessed to have their guidance as well as that of the other directors. They teach us how to work together, how to be supportive of one another when making decisions. The company is already at a mature stage, so we are looking at other opportunities or untapped potential such as investor relations and branding,” she says.
Most of the second generation have taken on significant management roles, with three of Lee Feng’s cousins overseeing specific areas of the group, namely mall leasing, hotel operations and construction in Johor. Her brother, Patrick, is responsible for the central region, including the mall and hotel in Bandar Bestari, Klang.
“There are quite a number of us in the second generation. There is a need to build a transparent and fair structure to positively take the company to the next level. With the structure in place, continuous engagement and investor relations, as well as consistent information flowing, these will eliminate any misunderstandings. That is important, so we can grow the company,” says Lee Feng.
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“Our voices are louder now, and we are being given the opportunity to make policy decisions because of our track record. We also became more aggressive after the pandemic as we saw stronger demand for properties in Johor, even before the boom of the Johor-Singapore Special Economic Zone (JS-SEZ). We sold more than 2,600 units in a year, and we gained confidence from the soft launches, the demand and very healthy take-up,” she elaborates.
Being a “local” developer in Johor has its advantages. “With the management being pretty flat, we make fast decisions. We use our own contractors, and do not outsource, so this helps with cost control, especially with the rising construction costs, and having long-term suppliers we trust. Materials are purchased in bulk and design-wise, we are cautious about ensuring our products are affordable to the mass market,” says Lee Feng, who graduated with a degree in biochemistry with management from Imperial College London.
Key assets and developments
Lee Feng joined KSL in 2010, about the time of the launch of its first mall, KSL City Mall. The mall, with a net lettable area (NLA) of 450,000 sq ft, is strategically located in central Johor Bahru, just 3km from the customs, immigration and quarantine (CIQ) complex.
With Lotus’s as its anchor tenant, the mall’s NLA is fully taken up, with a long waiting list. It commands rental rates of about RM20 per sq ft (psf). Integrated with KSL Hotel & Resort, the development is a major contributor to the group’s recurring income. Interestingly, a single-storey shop located just outside the mall, with a built-up of about 1,400 sq ft, fetches a monthly rent of RM30,000.
“We built KSL City Mall with our own cash. The thing about building during a financial crisis is that the building materials were cheap and contractors needed jobs, so the quote was at a good rate. Iskandar Malaysia was also coming up at the time, and local authorities like the Iskandar Regional Development Authority (IRDA) helped us a lot too,” she says.
KSL City Mall contributed about 50% to the group’s investment property revenue in FY2024.
The developer has come a long way since its inception in 1979. It has 30 landmark developments, mainly in Johor but also in the Klang Valley. These include 13 townships, 12 high-rise developments, two integrated developments and two industrial developments.
Apart from KSL City Mall, there is also KSL Esplanade Mall in Klang, which has an NLA of 650,000 sq ft. With Lotus’s as its anchor tenant there as well, it is linked to the recently opened KSL Esplanade Hotel, which features a Japanese-style public bath and private hot spring baths. Its third hotel is the 900-room KSL Hot Spring Resort in Taman Daya, Johor Bahru.
KSL has plans for its third mall and fourth hotel in the near future. The developer aims to redevelop a parcel in Nusa Bestari, Johor, beside Horizon Hills, which is currently being leased by Best Mart, when its tenancy ends next year. The land is surrounded by mature residential and commercial components.
Lee Feng says the Nusa Bestari township is 80% developed, with only some pockets of land left. The developer is building an integrated property portfolio, with plans to increase its recurring income to between 30% and 40% (FY2024: 19%).
“We do not have any projects linked to the Rapid Transit System (RTS) but we do have a development nearby, maybe 15 to 30 minutes from the CIQ. It is convenient enough for our residents to commute daily to Singapore for work and we’re selling at about half the price compared with other developments,” she adds.
KSL recently won a bid for an almost five-acre land in Jalan Tebrau for about RM137 million, or RM650 psf. Located about 5km from the upcoming RTS station, the developer plans to launch the serviced apartments in the first quarter of next year. The project also includes 40 retail units, 60% of which have been taken up, with prices ranging from RM4 million to RM8 million.
There is also the current launch of D’Secret Garden 2 @ Kempas Indah, with a gross development value (GDV) of RM1.5 billion. Located near the Senai International Airport and with direct access to the CIQ, the first two phases offer more than 3,000 apartments, priced at RM450 to RM550 psf.
KSL made its foray into the Klang Valley in 2008, when the developer acquired 474 acres in Klang for what is now known as KSL Bandar Bestari. Its second project was its low-density, high-end condominium project 18 Madge in Ampang, Kuala Lumpur.
The developer’s most recent launch in the Klang Valley is KSL Blossom Square in Setia Alam, just next to Setia City Mall and Setia City Convention Centre. The 18-acre mixed-use development will comprise shoplots and serviced apartments with a combined GDV of RM500 million. To be developed in six phases, the freehold land was acquired in late 2023 from S P Setia for RM228.8 million.
The first phase, on a five-acre parcel, comprises 21 three-storey shoplots and a 49-storey serviced apartment block called Haus Residences. Only the shoplots have been previewed, with built-ups ranging from 4,502 to 16,990 sq ft and prices starting at RM4.18 million. Haus Residences, with a total of 733 units, has built-ups of 550 sq ft (one bedroom) to 900 sq ft (three bedrooms). This includes 181 units (550 sq ft) set aside for the Rumah Mampu Milik scheme, priced from RM270,000.
With a proven track record, strong balance sheet (net gearing of less than 0.1 times as at Sept 30) and a sizeable land bank, KSL appears to be well positioned to sustain long-term shareholder value while expanding its integrated property portfolio.
Rosalynn Poh is an associate editor with The Edge Malaysia
