TAN Sri Lim Kang Hoo's vision to position Johor Baru as a cheaper alternative to Singapore, just like what Shenzen in China is to Hong Kong, remains undiminished more than a decade after he started on the project.
Towards this end, the deputy executive chairman and major shareholder of Iskandar Waterfront Holdings Sdn Bhd (IWH), has a huge appetite for land as it is integral to his plans and the job on hand of transforming Johor Baru into a heritage city.
When The Edge caught up with him for an interview two weeks ago, the 57-year-old KH Lim had just concluded a deal to acquire a 350-acre parcel of land in Johor Baru city centre.
The acquisition is part of IWH's ongoing exercise in transforming the Johor Baru central business district (CBD) apart from the ambitious waterfront development at Danga Bay.
This explains why IWH is looking for more land in the city centre, such as the recent purchase from a descendant of the late entrepreneur Wong Ah Fook.
"We have to acquire land to transform JB city. For instance, this 350-acre parcel is at the town centre and has 700 squatters on it. How are we to work on transforming the land if we don't own it?" he says.
It certainly has not been an easy task for IWH and KH Lim, who hails from Selangor, in particular, due to political and financial hurdles.
KH Lim has been receiving flak as some detractors claim he received big discounts on the land he purchased due to the support of the state government. There are also concerns that the state was losing control of its land to entrepreneurs such as KH Lim.
However, his supporters say such concerns are unfounded. According to them, IWH will eventually be majority-controlled by state and government agencies.
It is understood that a restructuring is in the works that will eventually see KH Lim and Kumpulan Prasarana Rakyat Johor with a 40% stake each in IWH.
Khazanah Nasional Bhd and the Employees Provident Fund will collectively have a 20% stake, bringing the equity interest held by government-linked agencies to 60%.
KH Lim, in his defence, claims that he had so far invested RM500 million of his own money in waterfront land over the past decade.
"I have the records to show that all the land was acquired fairly. Not an inch was given for free. I utilised all the money we made from our Sabah and KL projects to buy the land here. I've bought land for as low as RM1.50 psf to RM30 psf," he says.
KH Lim was referring to the clearing of the land in Lahad Datu, Sabah, for the largest plantation in the region — about 1.5 times the size of Singapore, that was undertaken by his construction outfit Ekovest Bhd for Felda.
It was during the 1997/98 Asian financial crisis that he purchased the 2,000-acre waterfront land in Danga Bay for over RM250 million as he had a vision of transforming Johor's rustic coastal front based on the Hong Kong-Shenzen model. He had to invest another RM250 million for reclamation work alone.
At that time, Johor had a few parcels of land pledged as collateral to the banks. When the state could not meet its debt obligations, it had no choice but to sell, and found a ready buyer in KH Lim.
According to KH Lim, banks are not that keen to give financing for reclamation work. It is understood that reclamation can cost anything between RM50 and RM60 psf, depending on the depth of the water.
This explains why the land, which is near Sungai Skudai, Sungai Danga and Sungai Melayu, did not appeal to other developers as most of it was under water.
"I could take the risk because of my experience in civil engineering, dredging and sewerage work. But it was hard. Four contractors ran away when we were doing the dredging. That's how challenging it is," he adds.
After all that, the recent deal struck with Country Garden Holdings Co. Ltd, one of China's biggest property developers, is a welcome capital boost for IWH.
This story first appeared in The Edge weekly edition of Dec 10-16, 2012.
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