KUALA LUMPUR: Datuk Choong Kai Wai is set to leave as president and chief executive officer (CEO) of SP Setia Bhd as parent Permodalan Nasional Bhd (PNB) looks to inject new energy into the property developer.
Sources said an announcement on Choong's departure could be made as early as this week by PNB, which itself recently saw the return of its former CEO Datuk Abdul Rahman Ahmad to lead the RM300 billion fund management company once again,
Choong, who succeeded Datuk Khor Chap Jen on Oct 1, 2021, brings over 30 years of experience in the property and construction industry, covering both domestic and international markets.
He established Setia Australia in Melbourne in 2010, successfully building it into a reputable brand in Australia's property market and a trusted developer in the Asia Pacific region.
Choong's potential departure comes at a pivotal time for SP Setia as the company is gearing up for several strategic initiatives. These include developing an industrial park in Johor with potential data centres, launching a real estate investment trust (Reit) valued at up to RM1.5 billion in 2025 and expanding its township projects.
We have reached out to SP Setia for a response.
In June, Choong announced that SP Setia had begun pre-IPO (initial public offering) preparatory work to establish the Reit, which will feature a diverse asset portfolio including retail complexes, office buildings, schools and a convention centre.
He said the strategy to unlock the value of identified land assets had brought the company closer to achieving a stronger financial position and diversifying its income streams.
SP Setia currently owns Setia City Mall in Setia Alam, the INC Mall here, Setia City Convention Centre in Shah Alam, Setia Spice Convention Centre in Penang and the Amari Kuala Lumpur hotel in the KL Eco City township.
The Reit's goal is to create a new pathway for investor value and company growth.
In its latest annual report, SP Setia outlined plans to reduce debt and divest non-core assets to enhance its investment properties for the Reit.
At that time, the company owned over 6,300 acres of land with a potential gross development value of up to RM119.74 billion.
SP Setia's net profit surged more than sixfold to RM295.03 million in the second quarter (Q2) ended June 30, 2024, from RM43.06 million a year ago, driven by higher land sales.
However, the company reported a RM101 million loss in Q2 from its 40 per cent stake in the Battersea Power Station (BPS) project in London.
Despite this setback, Choong said in a statement following the results announcement that he was optimistic about the company's operations and financial outlook for the remainder of the financial year.
Meanwhile, analysts left last Friday's meeting with SP Setia's management feeling positive after clarification on the RM101 million Battersea loss.
"Industrial parks will drive earnings growth beyond 2024, alongside the company's core township projects," Maybank Investment Bank Bhd said.
The firm added that Setia Alaman project, with estimated RM3.1 billion gross development value (GDV), is expected to start contributing from 2025.
"For its Tanjung Kupang industrial park (RM1.9 billion GDV, 2025-2031) in Johor, SP Setia expects to finalise the plans within two to three months, potentially involving data centres through land sale, built-to-lease agreement, or JV with data centre operators," it said.