Malaysia Property News is a free resource website sharing Daily Property News & information about Property in Malaysia, which related to, Property Market, Property Investment, Commercial Property , Hot Properties Malaysia, Real Estate, Retail Shop, Business Park, Condominium Malaysia, Terraces & Apartment Malaysia, Houses, Residence, Resort and many more.

Thursday, May 28, 2009

IGB puts 2 big projects on hold

Unfavourable market conditions have caused IGB Corp Bhd to delay two major projects with an estimated combined value of RM1.5 billion to RM2 billion.

This will likely affect its property development division in the current financial year ending December 31 2009.

Last year, revenue from property development fell by a third to RM169.97 million from RM252.48 million in 2007.

The two projects on hold are the final third phase of the Mid Valley City and the high-end Stonor condominium in Kuala Lumpur. They could take off from next year.

Nevertheless, group managing director Robert Tan Chung Meng expects the recent completion of its North Tower Offices and The Garden Residences to make up for any shortfall in that division.
The group's performance this year is likely to remain flat, he said.

IGB made RM172.87 million net profit on RM688.22 million revenue last year. It also made a gain from the sale of Gleneagles Kuala Lumpur of RM83.59 million.

On its hotel division, which contributed a quarter of revenue last year, Tan said that IGB will open The Cititel Kota Kinabalu this year.

The US$50 million (RM175 million) 550-room St Giles Makati in the Philippines, developed by associate company St Giles London, will be operational in the first quarter of next year.

IGB is also in discussions for possible hotel projects in Bangkok, Thailand; Sydney, Australia; and Hanoi and Ho Chi Minh City in Vietnam.

"We are talking to about 10 parties, some for joint-venture projects, some for management, and some to be wholly owned," Tan told reporters after IGB's annual general meeting in Kuala Lumpur yesterday.

He said the group's 910-room Renaissance Kuala Lumpur is still on the market and that it was also willing to sell the MiCasa All Suite Hotel in Kuala Lumpur that is undergoing a RM50 million renovation.

Tan said the asking price for the Renaissance is RM800 million and for the MiCasa, about RM200 million.

IGB's first quarter results, released yesterday, saw net profit decline 7.6 per cent to RM33.9 million from RM36.7 million in the previous corresponding period.

Better contributions from property investment and its hotel division helped revenue improve 2 per cent to RM165.6 million from RM162 million.

By Business Times (by Vasantha Ganesan)

No comments: