Guo­coland wants more land

Prop­erty com­pany eyes higher pro­file in next five years

The Star Malaysia - StarBiz - - News - By S. PUSPADEVI puspa@thes­tar.com.my

KUALA LUMPUR: Guo­coland (M) Bhd, the prop­erty arm of Hong Leong Group, wants to beef up its landbank in Greater Kuala Lumpur in or­der to be­come a renowned prop­erty com­pany and brand in the next five years.

In an in­ter­view, group man­ag­ing di­rec­tor Datuk Ed­mund Kong said since Guo­coland is backed with strong cash re­serves from its par­ent com­pany, ac­quir­ing landbank is es­sen­tial in the prop­erty busi­ness if it were to ex­pand com­pet­i­tively.

“We have been ly­ing low for a long time. So it is ap­pro­pri­ate to buck up and move up to the next level.

“With a strong team now, we can move ahead with our plans once we have the raw ma­te­ri­als (landbank) in our port­fo­lio,” Kong said.

Guo­coland has about 7,500 acres of un­de­vel­oped land in Rawang, Cheras, Sepang and Jasin in Me­laka.

Of these, a to­tal of 500 acres with a gross devel­op­ment value (GDV) of RM6­bil is be­ing planned for launch within the next three to five years.

The com­pany, which has a mar­ket value of RM826.5mil, is tar­get­ing RM1­bil sales for the fi­nan­cial year 2018 (FY18).

Tak­ing into ac­count land scarcity in Greater KL, Kong said it would only be vi­able to tar­get pock­ets of land to cre­ate more in­te­grated devel­op­ment projects.

There­fore, fu­ture devel­op­ments in the city fringe will be some­what sim­i­lar to the 8.5acre RM2.5bil GDV Da­mansara City. That mixed in­te­grated project, lo­cated in Da­mansara Heights, con­sist of Wisma Guo­coland, DC Mall, Me­nara Hong Leong, Sof­i­tel KL Da­mansara and DC Res­i­densi.

Kong said it is per­ti­nent to dif­fer­en­ti­ate it­self from other de­vel­op­ers and fo­cus on plan­ning, ex­e­cu­tion and timely part of the brand­ing strat­egy.

Ac­cord­ing to Guo­coland’s 2017 an­nual re­port, prop­erty devel­op­ment seg­ment re­mained the core driver of the group’s rev­enue stream, fol­lowed by prop­erty in­vest­ment, ho­tel op­er­a­tions and plan­ta­tion.

Kong said the com­pany is look­ing to achieve 80% oc­cu­pancy rate for DC Mall next month.

“Of the to­tal 76 lots, we have 35 food and bev­er­age out­lets that are cur­rently oc­cu­py­ing the space at the mall,” he said.

Mean­while, its ho­tel com­po­nent – Sof­i­tel – de­liv­ery as has also been gain­ing trac­tion since its soft launch in Au­gust this year.

On Guo­coland’s com­pet­i­tive­ness once the RM9­bil GDV Pav­il­ion Da­mansara Heights is op­er­a­tional, Kong said de­spite the glut in the lo­cal of­fice prop­erty mar­ket, he did not con­sider it a threat.

“It will com­ple­ment our busi­ness, as our tar­get mar­kets were dif­fer­ent,” he said.

“We see this as a good syn­ergy more than a threat. Both devel­op­ments will be an epi­cen­tre of Da­mansara Heights,” Kong added.

In the mean­time, Kong said Guo­coland would be launch­ing the 47.36-acre free­hold Emer­ald Hills in Alam Da­mai, Cheras in De­cem­ber, as part of its emer­ald brand se­ries.

The project, with a GDV of nearly RM1­bil, will have 21 acres of open space, which will be its “unique sell­ing point.”

With con­struc­tion ex­pected to start in the first quar­ter of next year, the project com­prises 1,378 con­do­minium units with price rang­ing from RM600 to RM700 per sq ft.

There will also be 181 two and three-storey ter­raced houses with prices es­ti­mated from RM1.1mil to RM1.5mil.

For the fi­nan­cial year ended June 30 2017, Guo­coLand’s net profit rose 6.5% to RM126.46mil from RM118.70mil a year ago, on lower rev­enue of RM285.61mil from RM315.08mil.

The im­proved earn­ings was at­trib­uted to higher profit con­tri­bu­tion from Guo­coLand’s as­so­ciate com­pany.

This is re­lated to the dis­posal of land lo­cated in Sepang, Se­lan­gor, while the lower rev­enue was due to lower con­tri­bu­tion from the res­i­den­tial project DC Res­i­densi in Da­mansara City, par­tially off­set by higher con­tri­bu­tions from Oval Kuala Lumpur and PJ Cor­po­rate Park.

Guo­coland shares closed up one sen, or 0.83%, at RM1.21 last Fri­day, with 175,900 shares traded.

Kong: We have been ly­ing low for a long time. So it is ap­pro­pri­ate to buck up and move up to the next level

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.