Scientex on track to deliver 50,000 affordable homes

• “By standardising our designs, we achieve economies of scale. Our streamlined approach minimises design development time, leading to faster turnaround times and improved efficiency.”

RAWANG (Jan 27): Scientex Bhd has made significant progress towards its goal of delivering 50,000 affordable housing units by 2027.

“We've delivered close to 36,000 affordable housing units and are well on our way to reaching our target of 50,000 units by 2027. Last year, we delivered 6,000 units, and we're aiming for 8,000 units this year,” said Scientex executive director Beh Chun Chong in an interview with EdgeProp.

Scientex embarked on its property development journey in Johor in 1995, driven by a commitment to address the critical need for affordable housing. Recognising the significant challenges lower- and middle-income earners face due to rising property prices, Scientex has aimed to provide accessible homes for all.

Fast-forward 30 years, Scientex has solidified its position as a leading developer in Malaysia. It boasts a substantial land bank exceeding 10,000 acres across Peninsular Malaysia, which has enabled the company to fulfil its mission of providing affordable housing options to a wide range of homebuyers.

“Our focus is on equitable distribution across our four regions: north (Penang, Kedah, Perak), central (Selangor), Melaka (Melaka and Negeri Sembilan) and south (Johor),” said Beh.

Balancing affordable housing with profitability

Striking a balance between affordability and profitability in the industry is a constant challenge for developers. However, Scientex reported a net profit of RM128.6 million in the first quarter ended Oct 31, 2024 (1QFY2025), driven by a 6% growth in property division revenue to RM483 million during the same period.

Asked on the key to its success in maintaining decent margins while selling at affordable prices, Beh said: “Discipline is paramount”.

“At Scientex, we maintain a focused and streamlined approach. Across our four regions nationwide, we offer a consistent range of products. For example, we offer two main variations of 2-storey terrace houses. A larger 18ft by 65ft lot size and a slightly smaller 16ft by 60ft lot size.

“This standardisation is crucial. By standardising our designs, we achieve economies of scale. A significant cost factor in property development is the time spent on constant design changes for each project phase. Our streamlined approach minimises design development time, leading to faster turnaround times and improved efficiency,” Beh explained.

Given inflation's significant impact on property development costs, Beh believes Scientex can effectively mitigate this challenge.

“We've successfully absorbed the impact of inflation thus far. This is partly due to our high-volume production of units and the standardised nature of our products. This allows us to leverage our purchasing power through significant annual orders, enabling us to negotiate favourable terms with suppliers and contractors,” he revealed.

West coast remains the focus for expansion

According to Beh, since 2017, Scientex has strategically expanded its presence across Peninsular Malaysia, venturing into Perak, Selangor, Penang and Kedah. This geographic diversification has significantly contributed to the company's growth. Two years ago, it further expanded its reach beyond Malaysia, entering the Indonesian and Thai markets, and drawing market attention to its expansion plans for the future.

“Our immediate focus remains on our domestic market. While we have ventured into Indonesia and Thailand with a small-scale 10-acre project (approximately 400 units), this serves as a learning ground for future international expansion,” Beh said.

“Currently, our domestic expansion is concentrated along the west coast, particularly along the North-South Highway corridor. We haven't yet explored opportunities in the east coast regions such as Pahang, Kelantan and Terengganu. We believe there is substantial growth potential within the existing west coast market,” he shared.

High-quality, affordable housing for the masses

Three years ago, when Beh joined Scientex, he had a clear objective to develop a new category of residential properties. Specifically, he aimed to create high-quality condominiums in the Klang Valley that would be both affordable and equipped with exceptional amenities.

“I’m proud to say that this vision is now being realised with the development of the Mori Residences series, including Mori Residences 1, Mori Residences 2, Mori Residences 3, and the upcoming Mori City. The imminent completion of Mori 1, one year ahead of schedule, exemplifies the value we deliver to our customers.

“I’m passionate about creating high-quality yet affordable housing options for the mass market,” Beh concluded.

EdgeProp.my is currently on the lookout for writers and contributors to join our team. Please feel free to send your CV to [email protected] 

Looking to buy a home? Sign up for EdgeProp START and get exclusive rewards and vouchers for ANY home purchase in Malaysia (primary or subsale)!