Moving with times
Sunland shifts focus to work-from-home developments
THE head of development giant Sunland says it is inevitable apartment buildings of the future will need to incorporate shared offices as the COVID-19 pandemic changes the way we work for good.
Sunland, which has a number of projects underway on the Gold Coast, reported its full-year results yesterday.
The company, led by managing director Sahba Abedian, reported a net profit of $2.4m – 86 per cent lower than the previous result of $17.7m.
Sunland said the result was affected by $13.9m of after-tax adjustments.
It said $8.5m related to scrapping the “obsolete” work done by designers and consultants for its Grace, Mariners Cove, Greenmount and Lanes Retail projects.
Mr Abedian said changes to market demand had meant they were pressing ahead with The Lanes retail project but in a smaller-scale neighbourhood centre format.
He said similarly Greenmount in Coolangatta would be redesigned with a focus on owner-occupiers and downsizers.
“With Greenmount … we are finding that the (luxury) owner-occupier market is outperforming (other markets) and a testament of that has been our development at 272 Hedges Ave,” he said.
“As such we have looked through our portfolio and realigned development proposals to conform with where the market is moving.”
Mr Abedian said Sunland was planning to lodge a development application for a luxury apartment tower at the Greenmount Resort site by the end of the year.
Sunland said a further $5.5m in after-tax adjustments related to writing down the net realisable value of its Bushland Beach project and its Labrador tower site on Marine Parade, which it is selling. The company has been selling off “non-core” assets such as Mariners Cove on The Spit and the Lakeview Retail Centre in Mermaid Waters and focusing on smaller-scale retail and residential apartment building projects with the exception of the Hedges Avenue high-rise.
Sunland said excluding the after-tax adjustments its underlying earnings were $16.4m.
Revenue was $167.18m – down 41 per cent – off the back of a 42 per cent drop in the total value of settled sales to $159.8m.
Sunland settled 70 luxury apartments at its Marina Concourse project in Benowa during FY20 for a total of $56m.
At Magnoli Apartments in Palm Beach it settled on 64 units for a total of $45m. A further 109 are yet to sell.
Sunland said at its flagship Gold Coast project – 272 Hedges Ave – contracts had been signed for 82 of its 98 units representing sales of $188m.
Mr Abedian said the Gold Coast would benefit from a surge in people working from home.
“This notion of work from home is something that will be with us for many years to come.
“People that once lived in concentrated city centres have the opportunity to consider lifestyle choices to new city centres and the Gold Coast will be one of the beneficiaries and we are already seeing it.”
He said this necessitated a rethink of the design of apartment buildings: “If you are creating a residential apartment (building) consideration should be given to shared office or shared working spaces. These are things that will naturally emerge.”
The sale of Mariners Cove is expected to contribute $8.1m to the company’s FY21 profit.
Sunland said the company would declare a special fullyfranked dividend of 3 cents per share from this sale.
No interim dividend was declared. However, Sunland has announced a final fullyfranked dividend of 7 cents per share.
The company had $13.1m in cash at the end of the financial year and $139.9m in undrawn working capital.
It said the sale of the Lakeview Retail Centre and Ingleside in Sydney had generated $37.9m and $11.5m in aftertax profit.
Sunland said it achieved a 26 per cent development margin as a return on costs, which exceeded its 20 per cent target.
WE HAVE LOOKED THROUGH OUR PORTFOLIO AND REALIGNED DEVELOPMENT PROPOSALS TO CONFORM WITH WHERE THE MARKET IS MOVING
SAHBA ABEDIAN