Setting the stage for exponential growth

Avaland Bhd, an Ayala Land company, is the new name of the former MCT Bhd. The transformation journey has taken several years but after much planning and preparation, the rebrand has finally been revealed to the public.

The journey began in 2015, when Ayala Land — one of the largest real estate developers in the Philippines — came to Malaysia to do a market study, says Avaland CEO Teh Heng Chong.

“It was not here to look for an investment. It was studying some of our infrastructure and what not. I think there was a Filipino employee at MCT at the time and he introduced Ayala to the company,” he recalls.

“In 2015, it came in as a minority shareholder with a 32.95% stake. And over the years up to 2018, it took up a majority stake of 66.25%. That’s when the change in management and the way it operated took place.

“In 2018, MCT officially became a subsidiary of Ayala Land. In 2019, new management was appointed, with myself and other C-suite executives. When we came in, we realised that the business model of the MCT structure at the time would not be able to cope in terms of growth and Ayala’s aspirations for the company.”

Although plans to rebrand the company were already afoot in 2019, certain issues needed to be dealt with before proceeding, Teh reveals. These included changing the business model, the structure of the company and how it operated.

“At that time, MCT was doing all kinds of businesses — being a developer, contractor, consultant … then wanting to run a cinema, a gym and so on. We felt that the structure could not work in terms of long-term and sustainable growth.

“So, we changed the core business to be purely property development, like any other developer you see in Malaysia, where we outsource construction and consultancy work.”

The Covid-19 pandemic and subsequent lockdowns put the brakes on the execution of its plans and activities. Nevertheless, the downtime proved fortuitous.

“It gave us an opportunity to review how we could actually strengthen our operations based on the new operational structure. We used the downtime to build our standard operating procedures, operational structure and resources,” he says.

“Then in 2022, when the market opened up again, we were ready because of the 2020/21 preparations. We started launching more projects and outsourcing most of our construction and consultancy. In 2023, we started seeing a lot of the seeds that we planted in the last three years beginning to bear fruit.”

He adds that the sales figures are healthy and that the public accepts its products and concepts. With these encouraging signs, it was decided that the time was right to announce the rebrand of the company and its new vision.

In selecting a new name for the company, Teh and his team had to go through many options.

“We worked closely with an international branding consultant. It came up with over 200 names, which we vetted thoroughly and finally decided on Avaland. We reinforced it by tagging on ‘an Ayala Land company’,” he says.

“The rationale for this name is that it is close to ‘avant-garde’, which means to embrace innovation and introduce new concepts. ‘Ava’ in English means to breathe and live. And it has a close [word] association with Ayala Land.

“During the downtime of 2020/21, we also went through this process of changing our mission, vision and core values. So, the mission is being ‘an innovative and timeless value creator’. We don’t just see ourselves as a developer, we want to create value in all our developments over time.

“In terms of mission, we are looking at ‘creating communities and enhancing lives for generations where people enjoy a complete lifestyle experience’. So, we are looking at a long-term sustainable vision and mission.

“We have expanded our core values [with an acronym that reads WE ACE IT, which stands for Winning mindset, Empowerment & ownership, Agility, Customer-centric, Ethics & Integrity, Innovativeness and Teamwork]. We changed it to match the new management and new owner’s mission and vision.”

To ensure the changes were taken to heart by the staff, Teh and his team had constant engagement with them to explain the new direction the company is taking and also streamline its focus on property development. These changes included hiring new talent and retraining employees.

The new corporate culture is also to align with the Ayala group in the Philippines, from which Avaland has a lot to learn and gain, says Teh.

“Ayala has more than 200 years of experience, so it has a DNA or culture that we are getting our people to have and be in sync with. One example is we are embracing ESG (environmental, social and governance) principles.

“We basically don’t have a structure within our organisation that has ESG experience or knowledge. At Ayala, it started this many years ago. So, when we tap into its experience, its journey, it is a shortcut in our [learning] process.

“So right now, we have already started our own sustainable department and it has engaged with headquarters to come up with our Green Blueprint. We will complete our Green Blueprint by July and we will have another launch in the market.”

In the meantime, the developer ensures that all of its projects have a Qlassic score of 75% and above, which is above the industry average, and has a GreenRE rating.

When asked to describe the Avaland employee, Teh says, “They are ambitious, young, innovative, talented, market driven and customer-centric.”

He adds that everyone from all departments must have this quality of taking care of the customer.

“We want to actually build an organisation where it is not just certain people who handle customers. We want every layer of the organisation to see customers as a very important aspect of the business.

“Every department, every function, indirectly deals with customers, whether it is an internal or external customer. External customers are not only our buyers, we also have suppliers and business associations. If you don’t deal with them well, the way they look at the organisation will be affected. That is why we are emphasising this with our human resources side to build this culture.”

An activity to enhance goodwill with the staff was the recent annual dinner, where the new company name was revealed. This transparency, Teh and his team believe, will increase employee satisfaction and contribute to Avaland’s growth. Incidentally, its employee satisfaction surveys have found that the staff is satisfied with how the company is being managed.

Teh reveals that Avaland has a land bank of 196 acres, with an estimated gross development value (GDV) of RM12 billion. The developer is targeting three market categories — high-end (using the Aetas brand name), mid-high and affordable. “When we penetrate different catchment areas or locations, we can introduce the right product for that location,” he says.

Avaland has several ongoing projects, including Aetas Damansara. Launched in December 2020, the high-end development features 226 units and has been 88% taken up. It will be completed by end-2024.

Other ongoing projects include high-rises such as the RM578.2 million Alira in Subang Jaya, with 832 units launched in November 2021; the RM321.3 million Sanderling in Cyberjaya, with 606 units launched in September 2022; and the RM205.4 million Casa Embun in Cybersouth, with 498 units launched in December 2022. For landed developments, there is the RM106.6 million Casa Bayu, also in Cybersouth, with 180 units launched in July 2020.

Future launches include Alora Residences, the residential component of the RM3 billion 2Fifth Avenue, a 13.36-acre mixed-use development in Subang Jaya. It has a GDV of RM552 million and will feature 770 serviced apartments and eight retail lots. The target launch date is in 3Q2023 and the developer aims to achieve a GreenRE Gold rating for the project.

“The first phase of 2Fifth Avenue is Alora Residences. 2Fifth Avenue has four parcels … In terms of components, our original master plan consisted of serviced apartments, some offices and plans for a hotel. This is all flexible because it depends on the market situation. If there is more demand for serviced apartments, we will do more of that. So, things are fluid at the moment,” says Teh.

Another two projects slated to be launched are Amika Residences in Subang Jaya and Anja Bangi in Bangi. The developer aims to achieve GreenRE Gold certification for these projects as well.

Amika Residences will have a Japanese theme and be situated next to a 10-acre central park. The 3.51-acre project, which has a GDV of RM440 million, will be launched in 3Q2023. It will feature 468 serviced apartments in two towers and 25 retail lots. The built-ups for the serviced apartments are from 883 to 1,227 sq ft and the selling price starts at RM635,000.

The 4.02-acre Anja Bangi has an estimated GDV of RM529 million. There will be two 48-storey towers, with 900 serviced apartments and 37 retail lots. The built-ups for the apartments range from 550 to 1,019 sq ft and the starting price is RM490,000. The retail lots and serviced apartments are scheduled for launch in 3Q2023 and 1Q2024 respectively.

Avaland bought land in Kuala Lumpur’s Seputeh and Taman Desa early this year. “As you can see, we are spreading to more established growth centres and moving closer to the city centre,” says Teh.

It plans to develop high-rises bearing the Aetas brand, namely Aetas Seputeh (estimated GDV: RM365 million) and Aetas Taman Desa (estimated GDV: RM500 million), for the two parcels of land. The developer aims to achieve GreenRE Platinum certification for these projects.

Aetas Seputeh will have 126 units, with built-ups from 3,000 sq ft and an indicative starting price of RM2.4 million. The launch date is targeted for 4Q2023.

As for Aetas Taman Desa, it will be designed to encourage more outdoor interaction, says Teh. The development, which is slated to be launched in 2H2024, will feature 236 units.

As the interview draws to a close, Teh highlights that Avaland has several goals.

“We want to launch at least three projects every year. This year, we will launch three. So, when you compound the GDV over the years, it will continue to increase and help with our unbilled sales. Our unbilled sales as at May 15 was RM822 million but we are expecting to hit the RM1 billion mark by year end,” he says.

“If we are aggressive in selling and constructing, we must replenish our land bank. Otherwise, we will run out of land. Our business development side is aggressively looking for more land, whether it is a joint venture or an outright acquisition.

“We are not just looking at real estate, as we want to grow the company. There may be other areas we can be involved in. Industrial [real estate] is one of them because in the Philippines, Ayala Land is involved in this segment and is open to exploring opportunities here. Our business development guys are looking at possible areas to go into.”

Avaland is also exploring opportunities that will produce recurring income such as leasing properties. Some properties in Cyberjaya are being considered for this purpose, says Teh.

The rebranding of the developer has been well thought out and executed. Now is the time for it to grow its presence and reach for greater heights.