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Saturday, July 30, 2011

Dijaya Corp thinks big

AFTER keeping a low profile in the past with sales below the RM500mil cap, property developer Dijaya Corp Bhd is changing course and moving into higher gear to become a more active developer with higher sales targets.

It is targeting sales of RM519mil for the current financial year (FY) ending Dec 31, 2011, RM820mil in FY2012, and RM1.24bil in FY2013.

The more ambitious sales targets will be supported by new project launches to the tune of RM839mil this year, RM1.7bil in 2012, and RM1.8bil in 2013. As at June 30, 2011, the company has unbilled sales of RM450mil.

Dijaya has an undeveloped landbank of 249 acres in the Klang Valley and Johor, that have potential gross development value (GDV) of RM12.4bil.

Tong: ‘Dijaya actively looking to expand its landbank’.

According to the company's 2010 annual report, it has some 11 acres of land left for development in Tropicana Golf and Country Resort, and 20 acres in Tropicana Indah Resort.

It also owns investment properties such as The Tropicana City Mall in PJ.

With two signature developments to leverage on, the 625-acre Tropicana Golf & Country Resort and 409-acre Tropicana Indah Resort Homes, Dijaya managing director Datuk Tong Kien Onn says the company will continue to build up its prowess in product innovation and ensuring superior quality and practicality in its projects.

Tong shares with StarBizWeek that the company is actively looking for opportunities to expand its landbank, and is in talk for three to four parcels of more than 200 acres each in Selangor.

Dijaya's most recent land acquisitions were sealed last month. It purchased an 88.5 acre parcel in Subang for RM385.5mil or at RM100 per sq ft, and 12.9 acres in Kampar for RM5.6mil or RM1 per sq ft.

On June 8, Dijaya's subsidiary, Tropicana Subang Development Sdn Bhd, inked a deal for the four parcels of freehold land on the outskirts of Subang from Chunghwa Picture Tubes (Malaysia) Sdn Bhd.

The land in Kampar was also from the same vendor.

The 88.5 acres at Pekan Country Heights borders Subang Jaya and Shah Alam.

Tong says the land will be developed into an upper medium range of mixed residential and commercial development with expected GDV of RM3.5bil.

“The residential development will comprise condominiums, linked and semi-detached houses and bungalows, while the commercial development will feature retail outlets, shopping malls and office lots as well as service apartments,” Tong explains.

He says the company has engaged GDP Architects to come out with the design plans and the development is expected to kick off early next year for completion in eight to 10 years.

The RM125mil Kampar project is still at the planning stage.

In the next two years there will be six new projects lined up for launch. The new launches will have an estimated GDV of RM2.5bil.

The first to get rolling next month will be Tropicana Cheras comprising terrace and semi-detached houses and bungalows worth RM185mil. The 26-acre project will take three years.

In October, Tropicana Avenue in Tropicana Golf and Country Resort featuring two floors of retail podium with offices and soho units above the podium block will be launched. The RM412mil project is targeted for completion in 2013.

The integrated commercial development of Tropicana Danga Bay will be unveiled in Iskandar Malaysia, Johor in September or October.

The RM3.8bil development will comprise service apartments, hotel, office tower, shopping mall, and retail cum office lots. It will take 10 to 12 years to complete.

Launches in the first quarter next year will comprise Tropicana Subang and Tropicana Bayou, gated and guarded residential projects on 66 acres in Balakong. The project will have GDV of RM400mil.

In June 2012, the Tropicana Gardens commercial centre will be launched on 14 acres opposite Giza Sunway in Kota Damansara. The lake-front project with GDV of RM1.8bil will feature service apartments, soho units, offices, a hotel and lifestyle retail space. It will take seven years to complete.

Tong says Dijaya will be focusing on integrated commercial projects and has a number of such projects lined up for the coming years.

With that strategy, contribution from commercial projects to revenue is expected to rise to 60% in the coming years from close to 50% now.

The company intends to keep some of its commercial space to build up its investment property portfolio and for regular rental income streams.

By The Star

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