An artist's impression of AP Land's mixed residential and commercial development in Changshu, China.
ASIA Pacific Land Bhd (AP Land) is on a regional brand building and expansion exercise in the property and oil palm plantation sectors to widen and diversify its earnings base.
With property projects worth RM1.5bil in Malaysia, China and Japan in the next three years, the company is well positioned to raise its profile as a regional property player.
AP Land's venture into the agriculture sector last year is also part of the company's strategy to build up a stronger earnings base.
The company made two acquisitions of oil palm plantation land totalling 36,000ha in late November last year and January this year.
The land will be fully planted over a four-year period and the first revenue will start streaming in by 2011.
“We would like to strike a healthy balance in our portfolio of investments. Our portfolio currently comprises the two main divisions – property and oil palm plantation/agriculture.
“Through prudent and resourceful management, we should achieve sustainable growth in both divisions in years to come,” joint managing director Low Su Ming told StarBiz.
AP Land has set out to build a strong plantation division to take advantage of the high crude palm oil price and demand in the global market.
Its long-term plan is to expand the company's plantations to 100,000ha in the next four years.
On the property business, Low said AP Land's maiden ventures in China and Japan would not only enhance the company's future earnings but also its profile as a regional property player.
With the sale of City Square Centre to Australia's Macquarie Global Property Advisors in the middle of last year for RM680mil and the settlement of RM350mil debts, the company is leveraging on its surplus cash position to pursue investment opportunities.
“With its debt-free status, AP Land is well positioned to seize good opportunities that may arise.
“We will grow according to the fundamentals of how we operate our business – the goal and objective is to grow shareholders' value, and the properties and projects that we invest in must perform and deliver,” Low said.
She said although the current global uncertainties, compounded by the high inflation and fuel prices, would dampen consumer and investor sentiments in the short term, “we remain confident this will only be temporary”.
Although the company is pursuing its overseas ambition, Malaysia will remain its mainstay.
“We do not want to put all our eggs in the same basket and having other overseas projects will be a cushion against any sudden market uncertainties.
“Diversifying into new markets will provide AP Land with another source of revenue if the Malaysian property sector moves to a lower gear,” she added.
Citing China, she said although growth had slipped from a high of 11% to 8% now, it was still a commendable rate.
“The Chinese government is closely monitoring the country's economic expansion to ensure it is based on sustainable growth policies and objectives to avoid any overheating.
“We see huge opportunities in China, especially in the third-tier cities. We are planning for more viable projects to make a bigger presence there,” Low said.
AP Land's maiden property project in Changshu, China, will take off in August with the launch of three-storey shop houses.
The three-phase project will comprise a mixed commercial and residential development of shop houses, offices, small office/home office (soho) units and apartments worth a gross development value (GDV) of 800 million yuan. The project will take three years to complete.
The 16.16-acre plot was acquired late last year from China's National Land Resources Bureau for RM46mil. It is located about 100km northwest of Shanghai.
Changshu is a third-tier city where a number of large multinationals from Taiwan and Japan have manufacturing operations.
AP Land, which recently acquired a piece of freehold land in Hokkaido measuring 3,082 sq m for RM18.9mil, will make its debut in Japan's real estate market later this year.
It is embarking on a niche boutique high-end residential development in the upcoming ski resort of Niseko, located in northern Japan. The project will generate an estimated GDV of 5.7 billion yen.
By The Star (by Angie Ng)