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Tuesday, June 24, 2008

Asas Dunia: Priority is to sell unsold units

PROPERTY developer Asas Dunia Bhd said it will concentrate on selling off what's already been built this year and hold off new launches.

The Penang-based developer has three new residential projects pending approval in Nibong Tebal, Jawi and Permatang Tinggi in Seberang Prai, with a total gross development value of RM215 million.

"Once approval is granted for the projects, we will begin earthworks at the 40ha site. However, timing of the launches will hinge on construction costs versus our selling prices," Asas Dunia managing director Datuk Jerry Chan said after the company's annual shareholders' meeting in Penang yesterday.

Chan: Penang's construction sector is going through a period of "hyper-inflation"

Chan said the construction sector in Penang is currently going through a period of "hyper-inflation" with rising cement and steel prices.

As such, any new launches by the company this year will depend on the backlog of unsold properties and its gearing level.

Asas Dunia's borrowings stand at be-low RM50 million.

Chan said its current unsold residential units were worth RM95 million, industrial RM13.5 million and commercial RM10 million.

"Our priority for now is to dispose of the unsold units, which will be priced between 25 per cent and 30 per cent higher than what we were selling before."

The unsold residential units are priced bet-ween RM110,000 and RM300,000, industrial ones RM350,00 and RM500,000, and commercial units RM180,000 and RM300,000.

All of Asas Dunia's projects are located on mainland Penang. It has 560ha of landbank held for development.

"The development value of the buildings, when erected on our landbank, will be in the region of RM2.8 billion," Chan said.

He said the federal government's plan to construct the second penang bridge has also generally enhanced the value of the group's properties and developments.

"It is a major relief for us to hear that the government will go ahead with the project as that will increase our properties' accessibility," he added.

By New Straits Times (by Marina Emmanuel)

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