The company which is into infrastructure, engineering, construction and development, has an active presence in 15 countries. In Malaysia, it’s the second largest toll operator and has residential townships under development and other businesses.
Tee Kim Siew, who heads AlloyMtd’s real estate arm, believes that it’s mantra — build for the local market — gives it a competitive edge in the industry.
“We see a lot of developers from the region go for really big projects,” Tee told the Australian Financial Review during a recent visit to Melbourne. “We felt we needed to study the market.”
“We don’t want to compete with them. There’s a niche (in the market) in which we can play.”
Tee added that the company wants to be a boutique player. “We believe that wherever you go, whatever you build, whatever you sell is for the local market.”
The Malaysian was stressing on what makes his company different from the others in the market who “use their networks in Asia to market their Australian projects”.
Going boutique is not euphemism for “lacking the means”. In London, for example, the company has begun work on a USD1 billion mixed use project at 1 Crown Place. The development has a small hotel, retail space, offices, and 247 apartments.
As in Australia, the company is targetting owner-occupiers unlike other companies which target offshore investors who may be driven by other factors. “If we sell to the Asian community, most of the lights go off at night,” said Tee. “We want the lights to be on at night.”
“We are mindful of that when we market our properties.”
The company is currently working on a Elenberg Fraser-designed USD60 million development in South Yarra, Melbourne, its most ambitious project so far. At this posh Rockley Gardens development, the company has reduced from the original plan for 78 units to 49, making each apartment larger than previously planned.
The market, according to Tee, now favours more spacious higher-end dwellings. A one-bedroom apartment goes for USD630,000, two-bedroom can be anything up to USD1.5 million and three-bedroom reaches USD3.5 million.
The fact sheets on AlloyMtd, not surprisingly, shows that the company has hardly any CBD — Central Business District — projects. Instead, it has “an impressive array of boutique projects”, located around inner suburban Melbourne.
AlloyMtd started with a modest USD20 million apartment building in northern Melbourne in 2011. The second and third projects, shortly thereafter, were a USD25 million 39 unit project in Port Melbourne and a USD40 million 59 unit development in South Yarra.
The company began in Australia a decade ago with a joint venture to develop a resort on Whitsunday Islands.
AlloyMtd, now privatised, has been estimated to be worth USD1 billion.
It’s on the hunt for passive assets. “If it’s something worth looking at, we will look at it,” said Tee. “If it’s too big, we are always willing to team up with another party.”
“The thing we look for is yield and capital value. We love recurring income.”
The company recently joined the bidding for One Collins Street, a CBD office building with a blue chip address. It lost to Harry Stamoulis which was willing to pay USD125 million for the building.