Crest Builder builds on RM1.8bil orderbook

CREST Builder Holdings Bhd has historically been a profitable group since going public through a reverse takeover of MGR Corp Bhd in 2003.

For nearly two decades, the construction group consistently stayed in the black – supported by steady project flows, healthy construction margins, recurring concession income and a disciplined approach to investments and developments.

The Covid-19 pandemic, however, broke that streak.

Construction shutdowns, labour shortages, cost inflation and project delays pushed the group into the red in the financial year ended Dec 31, 2020 (FY20) for the first time in its listed history.

But, Crest Builder turned around in FY24 (see chart), and group managing director Eric Yong Shang Ming says the recovery is durable.

Backed by a RM1.8bil order book and rising billings from its Bukit Tinggi Interpoint development, he believes the group is on track to stay profitable in FY25 and resume its growth trajectory.

According to Shang Ming, the group’s current order book is “good to last us until mid-2028.”

Founded in 1983 by the late Yong Soon Chow, Shang Ming’s father, Crest Builder has grown from a small contractor specialising in government jobs into a diversified construction and property group anchored by repeat private-sector clients.

The group no longer relies on public contracts the way it did in its early years – with its order book today entirely driven by the private sector.

Crest Builder counts many of Malaysia’s top-tier property developers – including Sime Darby Property Bhd, UEM Sunrise Bhd, Parkcity Group and Sunway Group – among its repeat clients, positioning itself as a trusted main contractor.

Construction — its bread and butter

Construction remains Crest Builder’s largest earnings contributor, accounting for nearly 80% of group revenue.

Shang Ming says the group tenders for between RM2.5bil and just under RM3bil worth of projects annually.

Last year, Crest Builder secured RM900mil-plus in new wins – including the RM448.5mil Sunway Velocity 3 job and the RM486mil Kiaramas condominium project.

This year, it has secured RM630.5mil worth of projects – the RM23.9mil reinforced concrete job for Quantum Quest Sdn Bhd in Jalan Tun Razak, the RM233.3mil Sunway Flora 2 contract, the RM299.4mil Desa ParkCity office tower and the recent RM73.9mil mechanical and electrical contract for CloutHaus mixed-use development in Kuala Lumpur.

For 2026, the group aims to replenish its orderbook with RM700mil worth of projects.

“We’re confident because our clients today are mostly repeat customers – and many of them have multiple upcoming launches. On average, they’re looking at four to six high-rise projects a year,” Shang Ming says.

“I’ve set a modest target for the team: by 2030, we want to hit RM1bil in annual turnover,” he adds.

Crest Builder currently has about eight ongoing jobs – all high-rise residential towers, although it has long-standing expertise in commercial high-rise as well.

“Our focus is actually all high-rise. Whether it’s residential or office towers and so on.”

“In the last couple of years, Klang Valley commercial high-rise slowed down due to a glut of office spaces, so we pivoted more into residential.”

While Crest Builder remains Klang Valley–focused, the group has completed projects in Penang and Ipoh in the past and is now revisiting opportunities there – as well as exploring potential entry into Sabah and Sarawak, particularly Kuching.

“In Sabah and Sarawak, we’ll be focusing on the public-sector jobs. We are participating in some tenders. Hopefully, something can materialise by the third or fourth quarter next year.”

Shang Ming, however, rules out Johor for now.

“Johor is overheating a bit. There are too many units coming onto the market at the same time,” he says. “Yes, take-up looks encouraging, but from a construction standpoint, when there are too many concurrent projects, it becomes a subcontractor’s market.”

Cost pressures and operational efficiencies

Operationally, Crest Builder is sharpening its focus on speed and site productivity.

“For high-rise jobs, we typically achieve 3.5 to 4.5 floors a month, and some projects have reached five floors,” says Shang Ming.

“That level of productivity is something we’re very proud of.”

While the group has explored industrialised building systems (IBS), Shang Ming says adoption remains measured.

“IBS still costs more than conventional methods. And with the current data centre boom, IBS players are already stretched with demand. Hence, we utilise it only where it makes sense.”.

Construction margins, he notes, are a far cry from previous decades.

“During my father’s time 30 to 40 years ago, construction margins were easily 25% to 40%. Today, the industry is down to single digits. But we’re targeting high single digits – around 8% to 10%.”

Shang Ming acknowledges that new policies including higher foreign worker levies, Employees Provident Fund contribution for foreign workers and the broader sales and service tax implementation are positive for long-term sector professionalism, but the rapid rollout has created short-term pressures.

“All these measures are good for the industry, but imposing too many at once affects margins.”

Opportunistic, not asset-heavy

Construction aside, Crest Builder’s approach to property development remains selective and capital-light.

The group ventured into property development the same year it went public, launching 3TwoSquare, the mixed development in Petaling Jaya where its headquarters still sits.

“Property development is very capital heavy, especially township-scale projects that require major infrastructure outlays. We avoid that.”

Instead, he says Crest Builder favours smaller, ready-infrastructure parcels in mature areas – “pocket lands” – even at slightly higher land cost. “It allows us to start immediately and ensures faster turnaround.”

The group’s current Bukit Tinggi Interpoint development, launched in 2023, has achieved an 82% take-up rate, with unbilled sales of about RM300mil and completion is targeted for 3Q27.

“Because the three towers sit on a massive podium, early billing was limited. We expect billings to accelerate meaningfully in 2026.”

Crest Builder has no landbank currently, but Shang Ming says the group is evaluating opportunities – including joint ventures under its new subsidiary, CB Vantage Sdn Bhd – for potential affordable housing projects.

“High-end projects are plentiful, but affordable housing remains undersupplied. With our construction expertise, we can help optimise cost, cash flow and delivery – while supporting the government’s agenda.”

Expanding opportunities in M&E

Beyond construction and property development, Crest Builder is also scaling its mechanical and electrical (M&E) arm, CB Tech (M) Sdn Bhd, which began in 2000 as an internal support unit.

CB Tech handles air conditioning, plumbing, electrical, mechanical works, firefighting systems and building automation. Its total order book stands at RM240mil, with unbilled work of RM170mil.

“We aim to replenish RM150mil to RM200mil annually, both internal and external,” Shang Ming says.

“It’s becoming strong enough to stand on its own as a distinct business segment.”

Recurring income

Crest Builder continues to generate stable recurring income from property investment and concession assets.

On its investment property, Tierra Crest – developed on a former Telekom Malaysia Bhd football field – now houses the Unitar campus.

On the concession front, the group still receives rental income from its UiTM Tapah campus, built under a private finance initiative (PFI) signed in 2011. The project was constructed in three years with a 20-year concession that ends in 2034.

“We collect about RM43mil annually. There are nine more years to go,” says Shang Ming.

While the group is exploring new PFI opportunities, the landscape has shifted.

“Recent PFI models place more demand risk on concessionaires. Some beds are as low as RM7 per day. For financial models to work, concessions may need longer tenures or government cost subsidies. Without that, numbers don’t add up.”

Gearing level largely ring-fenced

Crest Builder’s net gearing stands at around 1.3 times, but most of this stems from RM510mil Sukuk financing for the Universiti Teknologi Mara (UiTM), Tapah’s hostel concession – which is “ring-fenced”.

“If you remove the Sukuk, our effective net gearing is about 0.4 times, which is healthy for a construction player,” says Shang Ming.

Staying asset-light remains a deliberate strategy, he adds.

When asked whether being asset-light would make Crest Builder dependent on large developers, Shang Ming dismisses concerns that the group is over-reliant on them.

“Malaysia is still growing. Beyond Klang Valley and Johor, many areas are underdeveloped. There’s still plenty of opportunity, even if project cycles are longer.”

Industrial development, foreign investment-driven commercial buildings and warehousing are emerging as major growth verticals, he adds.

On the entry of Datuk Joseph Lau, the chief executive officer of Perdana ParkCity Sdn Bhd, as Crest Builder’s second-largest shareholder with an 11.1% stake via a private placement that raised RM24.3mil in June 2025, Shang Ming sees “positive synergies”, especially given the group’s 15-year track record with ParkCity projects.

But he stresses the group will not become dependent on any single master developer.

“We remain at arm’s length. It’s important that we keep our eggs in multiple baskets.

“We work with township-scale developers and also standalone project owners.”

At press time, Crest Builder’s shares traded at 51 sen – down 15% year-to-date.

It trades at 7.6 times earnings, compared to the construction sector median of about 17 times, based on Bloomberg data.