Lim Han Qin, representing the next generation at the helm of the company, talks about how the business has diversified and entered new markets in recent years
Soilbuild Group Holdings’ new headquarters at Defu South Street 1 features double-glazed glass walls to cut off the noise from the nearby Paya Lebar Airbase. Nine fish-tank-style meeting rooms overlook a central landscaped courtyard. There are also a boardroom and a training room.
The office pantry designed as an open kitchen with a long countertop and bar stools on either side has become a popular gathering place for staff to socialise. Other amenities include a well-equipped gym, shower room, steam room and nursing room.
A lot of attention was paid to “doing up the office nicely”, says Lim Han Qin, director of Soilbuild Group Holdings. “These days, young people place a lot of value on a beautiful office.” A staff welfare committee was set up to organise activities, for instance, exercise classes at the start of the week to beat the Monday blues and quarterly staff buffet dinners.
Unlike Soilbuild’s headquarters and Prefab Innovation Hub, the entire area around it is still very much a construction site. Like all pioneers in a frontier location, being the first had its own logistical challenges. “When we first moved in last year, Grab cars didn’t even come here; you couldn’t find the address on Google Maps; and food options were limited,” says Han Qin. To counter that, Soilbuild provides regular shuttle service for staff to go out for lunch and to the nearest MRT station.
Soilbuild had purchased the 219,708.3 sq ft, 30-year leasehold site at Defu South Street 1 in September 2015 for $23.89 million. The site is designated by Building & Construction Authority (BCA) as part of the Integrated Construction and Prefabricated Hub that caters for the production of prefabricated construction components, such as precast columns and beams, prefabricated bathroom units (PBUs), modular prefabricated mechanical, electrical and plumbing (MEP) systems, and prefabricated prefinished volumetric construction (PPVC).
In addition to land cost, Soilbuild spent another $50 million on highly automated equipment for the precast plant, an administrative office and a dormitory for 1,000 workers. All in, the entire complex is estimated to have cost close to $100 million, according to Han Qin.
The new headquarters signifies the evolution of Soilbuild Group in recent years as it invests in automation and new technology for its construction business, ventures further beyond Singapore’s shores and makes forays into new asset classes.
It also heralded the entry of a new generation of Lims at the forefront of Soilbuild Group Holdings: Han Qin, 32, who came on board in 2016; and his elder brother, Han Feng, 33, who joined the firm as a director in 2014.
Their youngest brother Han Ren, 27, is working as an analyst at a private equity firm. “He just graduated over a year ago,” says Han Qin. “We will let him decide whether he wants to join the company. However, every now and then, I will ask him what his plans are.”
They are the sons of Soilbuild Group Holdings’ chairman, Lim Chap Huat, who co-founded the firm as a construction outfit in 1976. It is not just Lim’s sons; his wife, Leo Jee Lin, is also part of the business. Having joined Soilbuild in 1984, she is the head of marketing and leasing division.
“My mum retired for a while as she was looking after my younger brother’s child,” explains Han Qin. “Now that her grandchild is attending school full-time, we asked her if she could return as we would benefit from her vast experience.”
Over the years, Lim, now 65 years old, grew the business and diversified into property development – from houses and condos to industrial buildings and business space. He has since bought out the shares of the other two co-founders. Lim listed Soilbuild Group Holdings on the Singapore Exchange in 2005, but privatised it in 2010.
Lim subsequently listed Soilbuild Construction Group in 2013 where he is both executive chairman and CEO; and spun off Soilbuild Business Space REIT in 2014. He is still a substantial shareholder of both listed entities: he holds 74.61% of the shares in Soilbuild Construction, which had a market capitalisation of $50.5 million at six cents a share; and 9.87% of the shares in Soilbuild Business Space REIT, with a market capitalisation of $623.2 million and share price of 58.5 cents as at Aug 13, according to Bloomberg.
Both the listed companies – Soilbuild Business Space REIT and Soilbuild Construction Group – have their own management teams and operate independently, emphasises Han Qin.
Ranked among Singapore’s 50 richest by Forbes last year, Lim is reported to have a net worth of $895 million. As the third of seven children and the eldest son of a trishaw driver and washerwoman, Lim has certainly come a long way.
According to Han Qin, from the time he was in primary school – “about Primary 3” – family outings on weekends had been visits to construction sites and sales galleries, including other developers’ showflats. “It sparked my interest in property,” he says.
After graduating from the National University of Singapore with a law degree, Han Qin spent three years in the corporate mergers & acquisitions department of Allen & Gledhill. “I thought I was going to stay only a year, but I ended up staying on for more than three years because the work was interesting,” he says.
His father allowed them to pursue their own interests. “He didn’t tell us what to study,” says Han Qin. While he read law, his two brothers’ interests were in the financial sector. However, Han Qin felt compelled to “come and help” at Soilbuild as it is, after all, the family business.
In Soilbuild Group, Han Qin focuses on the property development business in Singapore, Myanmar and Vietnam.
In the pipeline for launch is Verticus, a 162-unit, freehold condo development on Jalan Kemaman, off Balestier Road. The new project sits on the site of the former Kemaman Point which Soilbuild Group purchased en bloc for $143.88 million in June last year. Based on the plot ratio of 2.8 and maximum gross floor area (GFA) of about 122,711 sq ft, the land price translates to $1,173 psf per plot ratio.
Soilbuild Group is no stranger to Balestier, having developed five other projects there in the past: the latest was The Mezzo, a mixed strata-titled commercial and residential development, which was launched in 2009 and completed in 2012. The others were The Centrio and Montebleu, both launched in 2007, with the former completed in 2009 and the latter in 2010. Pinnacle 16 was launched in 2003 and completed in 2006, while Mandale Heights was launched in 2001 and completed in 2004.
“I guess we have an affinity for Balestier,” says Han Qin. “I remember when I was younger, we used to visit the construction sites in Balestier with my parents as we had five projects there over a short span of time. We like the area because of its city-fringe location, accessibility, rich heritage and vibrancy, with a lot of good food.”
Kemaman Point’s location is also attractive as it is just behind Balestier Plaza and near two other malls, namely Shaw Plaza and Zhongshan Mall at Zhongshan Park, which has a Fairprice supermarket and eateries such as the recently opened New Ubin Seafood restaurant and Starker Bistro. The Balestier area has also become a “hipster neighbourhood” with cafes such as Wheeler’s Yard and Brown Sugar Cafe Bistro, says Han Qin.
The purchase of Kemaman Point came one month before the ninth round of property cooling measures kicked in on July 6, 2018. “In a way, that attested to our strategy of not putting too many eggs in one basket,” says Han Qin. “Even though we didn’t undertake many residential projects in Singapore over the past decade, we had residential developments in Myanmar and Vietnam.”
Soilbuild Group’s maiden residential development in Myanmar was the 176-unit Rosehill Residences, developed in 2015 in a 60:40 joint venture with its local partner in Myanmar.
Soilbuild Construction in Myanmar is undertaking the construction of Rosehill Residences, its maiden construction project there. The construction arm entered Myanmar in 2012 and started with 15 people. Today, it has a staff of about 60, adds Han Qin.
In December 2017, Soilbuild Group made its first foray into Vietnam in a joint venture with a local partner, CT Group, to develop a mixed-use residential and commercial retail project in District 9 of Ho Chi Minh City. The project, Metro Star, sits on a 197,385 sq ft site and will have two 30-storey towers containing 1,600 apartments. The project is under construction and scheduled for completion in 2Q2021.
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District 9 is where the existing Saigon Hi-Tech Park is located, and there are plans underway for a new scientific and technological park modelled after Silicon Valley in the US. Metro Star is well situated to benefit from future growth and “property price upside” in the area, says Han Qin. The first phase has already been launched and 25% of the project has been sold to date.
In April 2018, Soilbuild Group signed two more MOUs with CT Group. One is for the development of I-Town Affordable Housing Township in Ho Chi Minh City with an estimated development value of US$350 million. The other is for the development and implementation of its prefabrication technology and PPVC systems in Vietnam.
In Singapore, Soilbuild Group purchased an old bungalow sitting on a 16,028 sq ft, freehold site on Wilkinson Road for $19.28 million in 2015. The site has been redeveloped into two detached houses sitting on freehold site of 8,021 sq ft each.
Each house has a built-up area of 15,300 sq ft, and comes with six bedrooms, an 11m swimming pool and covered parking for up to five cars. Both houses are fully fitted with kitchen cabinetry and appliances, air-conditioning units, bathroom accessories and sanitaryware, as well as home security system with CCTV. They have since been sold.
“Residential development is something that is close to our hearts,” says Han Qin. However, the group has allocated more capital into industrial developments over the past decade. He adds: “We want to be diversified – by sector and geography. Hence, even overseas, we are in the residential and industrial as well as business space.”
Soilbuild Group has five industrial projects in Singapore currently. Its latest purchase was an industrial land parcel on Gambas Way which it won with a bid of $40.02 million in June this year. Last October, the group also purchased an industrial site on Corporation Road for $44.09 million. Both sites were purchased on a 30-year lease from JTC in government land tenders.
The group also won two industrial sites in Tuas last year: a site on a 20-year lease at Tuas South Link 3 for $2.63 million in January; and an industrial site on a 30-year lease for $28.85 million. They also purchased a site on New Industrial Road in a private treaty.
A new market segment that Soilbuild Group entered recently is purpose-built student accommodation in the UK, with the purchase of Innovo House in Liverpool’s Knowledge Quarter in March this year. The site, which broke ground in May, has been approved for a 124-unit student housing scheme, with the development “forward funded” by Soilbuild Group.
The plan is to build a sizeable portfolio of student accommodation in the UK, says Han Qin. The business is headed by his elder brother Han Feng, who is actively looking for more opportunities in the sector. In addition to that, he is overseeing the family office.
Last September, Soilbuild Business Space REIT made its maiden overseas acquisitions with two properties in Australia: a centrally-located office building in Canberra for A$55 million; and a poultry processing plant in Adelaide, South Australia for A$44 million.
As the group is small, it is important to “stay nimble, respond swiftly to market changes and to redeploy capital across various asset classes”, says Han Qin. “I think we have shown that in the last 10 years: From residential, we switched to industrial space and we did very well. And now, we have expanded regionally.”