‘RM5.6B SALES ACHIEVABLE’
Repackaging of existing, new project launches to help lift H2 numbers
PROPERTY developer SP Setia Bhd is confident of securing RM5.65 billion sales this year due to ongoing efforts to “repackage” some of its existing and new projects.
Despite a lacklustre local property market, chief executive officer Datuk Khor Chap Jen expected property sales to pick up in the second half, with a 10 per cent improvement over last year’s achievement.
The company recorded lower year-onyear sales of RM718 million in the first quarter. “Typically, sales in the first quarter are a bit slow,” he said, adding that in the pipeline there were also bookings worth more than RM700 million.
“If we secure RM1.4 billion sales in the first quarter, then we are on track to achieve our target and we will have a clearer picture in the second half,” said Khor after a shareholder meeting, here, yesterday.
SP Setia had launched RM339 million worth of development projects in the first quarter and will continue with RM6.47 billion worth of property launches from the second quarter.
“The projects will be mainly in the central region, followed by the southern and northern region, as well as in Kota Kinabalu, Sabah, and in Vietnam,” he added.
SP Setia’s new sales this year would come from launches of existing projects and completed inventory sales.
“We target about 89 per cent sales from new local projects and the remaining 11 per cent from international properties,” said Khor, adding that the company had less than 30 per cent of unsold units annually.
He said the property overhang issue was
“manageable” as plans to sell the unsold units had been executed.
“In fact, we have reduced (the unsold units) from RM1.6 billion previously to RM1.4 billion over less than six months. We will continue to reduce the unsold units in five main projects in Johor, Penang and central region.”
Khor also said the company might acquire more landbank. SP Setia has about 3,835ha of land with an average gross development value of RM145.9 billion, which can sustain the company for about 24 years.
Khor was also upbeat on securing more sales for the Battersea Power Station Phase 2 and 3 projects in the United Kingdom, despite a year’s delay in construction work.
Both projects are expected to be completed by 2021 with some marginal changes in occupancy due to change in construction method and Brexit uncertainty, he added.