Selangor Properties plans RM825m launches in 2015

KUALA LUMPUR: Selangor Properties Bhd is focusing on organic growth and plans to launch two property projects in the Klang Valley with an estimated total gross development value (GDV) of RM825 million in this calendar year.
COO Chong Koon San said the first project includes 38 units of semi-detached homes priced above RM1.8 million and 24 units of bungalows priced above RM2 million in Bukit Permata, Gombak with a GDV of RM125 million.
"The Bukit Permata project is expected to start middle of this year. We're in the midst of getting relevant approvals," he told reporters after the group's AGM here last Friday.
The launch of the group's project in Bukit Permata had been delayed due to longer time required for building plan approval which was secured in early 2015. This project is expected to contribute to the group's earnings in 2015 and in the near future.
The second project is a high-end 105-unit condominium in Damansara Heights with an estimated GDV of RM700 million that is targeted to launch in December 2015.
The group has a landbank of 264 acres in Damansara Heights, Hulu Langat, Selayang and Gombak that can keep it busy for the next 10 years. It has increased efforts to source and explore suitable land, notably in the Klang Valley, which are sizeable for township development. It has engaged property consultants as well as direct contact with land owners for such purpose.
"We're trying to increase our landbank. Definitely there are plans and we've been shown a few parcels in the Klang Valley but things are still ongoing," said Chong.
The group expects a slight improvement in its financial results for the year ending Oct 31, 2015 (FY15) compared with FY14 where it registered a net profit of RM198.6 million and revenue of RM101 million.
Chong said the group is focusing on organic growth and that its recurring income is steady, thanks to revenue from rental, car park and its investment portfolio, which includes Menara Milenium, Kompleks Pejabat Damansara, 16 Shops Batai and Taman Tunku Apartments. However, he pointed out that property development is the one that would spur growth.
"If we have a launch of property and have good take-up rates, that would spur the additional growth," said Chong.
Director of finance Lee Tart Choong said there will be slight improvement in the group's financial performance for FY14 because of the refurbished shops in Jalan Batai, which it spent some RM3 million. The enhancements of shops will enable the group to strengthen its favourable occupancy rates, which stood at over 90%.
"We will get better occupancy rates this year as the period of refurbishment is over so we expect some improvement there," said Lee.
The residential housing project in Selayang Mulia is still in its planning stages and is expected to be launched after 2015. It is estimated to have a GDV is RM395 million comprising 1,724 units of 2-3 storey link houses, medium cost apartments and low cost apartments.
The group said it does not have a need for a real estate investment trust as it has sufficient funds.