Door company Slide & Hide MD places his faith in real estate in S’pore and China, and blue-chip property stocks
HE HAS worked in the construction industry for more than a decade and so it comes as no surprise to learn that Mr Andrew Lim, the managing director of door company Slide & Hide System, opts for property-related investments such as real estate and property stocks.
He said he has more than $500,000 invested in the Singapore stock market, mainly in blue-chip property counters like Wing Tai, CapitaLand and Chip Eng Seng.
‘I prefer to buy blue chips because they are well managed. The management is transparent so I can be assured that the company won’t collapse,’ he said.
His property investments include factories in Singapore as well as office space and an apartment in China.
Mr Lim, 48, has come a long way from his childhood days. His family was poor and he spent much of his time helping his father collect leftover food from households to feed the pigs at their squatter hut in Toa Payoh.
A polytechnic graduate in civil engineering and a student of the school of hard knocks, he had his fair share of challenges when he started Slide & Hide in 1994.
At that time, he was the first in Singapore to manufacture and supply a pre-fabricated, concealed sliding door wall system, and it took much perseverance before his product became accepted by architects and interior designers.
‘I was not able to secure any big project owing to the fact that my product was new and, hence, still not accepted in the construction industry yet. As I did not have enough money to employ people, I doubled as the salesman, factory manager, delivery man and site supervisor,’ he said.
He recalled how a contractor cheated him in his first project, creating cash-flow problems for his company.
Fortunately, he managed to avert going bust with a loan of $100,000 from his father-in-law, a retiree who used to work as a packager at flour miller Prima.
His business picked up in 1995 after he managed to secure bigger contracts, supplying his product to the Pebble Bay and Signature Park condominiums. By 1997, he had broken even and repaid his father-in-law.
His wife, Hui Ngoh, 47, whom he married in 1989, is an administrator. They have two sons aged 15 and seven.
Q What are your money habits?
A I draw a monthly gross salary of $5,000 from my company, which is enough for me and my family’s daily needs.
The profits the company makes are partly re-invested to grow the business and paid to me as director fees, which I use for my property and stock investments, whenever an opportunity arises.
I am a Buddhist and I always keep in mind the saying: Don’t consume more than what you need. For every cent I spend, I make sure it is spent wisely. I don’t buy branded goods just for the sake of flaunting them or feeling good, and we dine mostly at hawker centres and only in restaurants when I need to entertain business clients and friends.
Q What investments do you have?
A My investments are mainly in my business, properties and Singapore stocks. I started Slide & Hide with $200,000, and it has grown many folds.
As for my properties, I bought four adjoining units of a flatted factory in Singapore over time from 1996 for my own use and to guard against future rental increases, as well as to prevent eviction by the landlord.
I own a four-room HDB flat in Ang Mo Kio, which is being rented out. In late 1996, I bought a freehold condo unit in the River Valley area as an investment.
I began investing in China properties in 2005 with the purchase of an office unit in Shanghai for around half a million dollars. This was when I noticed that the supply of offices could not catch up with demand because of the influx of foreign companies there. The price has since appreciated more than 35 per cent.
I also bought two apartments in Zhuhai, a city in southern China that is next to booming Macau. One was sold for a 35 per cent profit in the middle of last year, while the price of the other unit has more than doubled. My China properties are generating net rental yields of above 7 per cent.
I started dabbling in the stock market in 1990, and I currently have more than $500,000 invested mainly in Singapore blue-chip property counters.
Q What about insurance planning?
A I don’t view insurance as an investment tool to earn a profit but as protection against disability and death.
That is why I believe in buying term insurance where the premium is low and the coverage is high. I am covered for more than $600,000 on my life. My annual premiums amount to nearly $10,000.
Q What is your investment philosophy?
A I don’t feel comfortable investing my money in instruments where I can’t make direct decisions such as unit trusts, or investing in an unfamiliar territory like a non-construction-related business.
When it comes to stock investing, I buy when there is an opportunity; that is, when there is bad news, and I feel that the price is value for money.
I monitor a few selected stocks which are mainly property-related. In the last few years, I have achieved average annual returns of about 20 per cent from my stock investments.
Q Money-wise, what were your growing- up years like?
A My parents worked very hard to support me and my two younger brothers and sister.
When we relocated from our kampung squatter to a 300 sq ft rental flat in Toa Payoh, the six of us had to adjust to sharing one small bedroom and a toilet. Living in such a cramped environment conditioned me to be more patient and tolerant.
From pig farming, my father went on to start a building construction business while I was studying at the Singapore Polytechnic.
Later, he was cheated by his partner. That experience taught me the danger of trusting people too easily, the importance of having full control and prudent management of my finances.
Today, my wife and I constantly remind our children to be thrifty. We give them only sufficient pocket money to spend on food, other necessities and transport to and from school.
Q What has been a bad investment?
A My worst investment was putting $10,000 with a friend working in a commodities company in 1990.
Over a one-week period, he made buy and sell transactions with a loss without my knowledge and called me to top up my account. I terminated it immediately.
I lost $10,000 of my hard-earned savings that week.
Q Your best investment to date?
A My best investment is my business.
It has provided me a stable income, a comfortable life for my family, as well as the freedom to decide what I want to do.
Q What is your retirement plan?
A I am financially independent now, but I want to carry on working as I enjoy the challenges of making my company grow.
My long-term plan is to use my civil engineering knowledge and experience to help charitable organisations or to link up with like-minded people to sponsor and build orphanages in poor countries.
I believe $4,000 a month is enough to cover my expenses and that of my wife in our old age.
Q And your home now is?
A When I sold my executive mansionette in 1994 to raise capital for my business, I promised my wife that I will buy her a condo unit 10 years later to show my gratitude for her support and sacrifice.
So in mid-2003, I bought a 1,400 sq ft unit near Bishan, and we have been living there ever since.
Q And your car is?
A A pearl white Toyota Camry.
Source: The Sunday Times 17 Feb 08