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Friday, February 24, 2012

Liew confident SP Setia will meet RM4bil property sales target

SHAH ALAM: SP Setia Bhd recorded a 26.6% year-on-year jump in new property sales to RM933mil for its first quarter ended Jan 31, 2012, compared with RM737mil a year earlier.

President and chief executive officer Tan Sri Liew Kee Sin said he was confident about achieving the group's target of RM4bil in new property sales for its financial year ending Oct 31, 2012 (FY12), despite credit-tightening measures as a result of Bank Negara's responsible lending guidelines.

Effective this year, banks have started using net income instead of gross income to calculate the debt service ratio for loans.

The credit-tightening measures were partially blamed for a 25% year-on-year drop in new vehicle sales in January.

For FY12, SP Setia plans to launch properties with a gross development value of RM6bil.

Liew said the group's projects in Johor, Setia Alam and Setia Eco-Park in Shah Alam, as well as KL Eco City mixed development in Kuala Lumpur were expected to generate RM1bil each in new property sales in FY12, while another RM1bil would come from sales of other domestic and foreign projects.

KL Eco City, located on a 24-acre site along Jalan Bangsar (opposite Mid Valley City), was launched last October and recorded RM303mil in sales for the first quarter of FY12.

“Yes, the central bank's lending guidelines would definitely impact the property sector. But, speaking for SP Setia, we will do well and also increase our prices,” said Liew after the group's AGM in Setia Alam.

He pointed out that the recent soft launch of the group's Phase 8D of semi-detached homes in Setia Eco Park had seen bookings for nearly all the units offered, over one week-end.

“Today, our landbank is 4,218 acres. We have a lot of things going on.”

On Saturday, SP Setia will officially launch its maiden project in Sabah, namely the Aeropod integrated commercial development in Tanjung Aru.

In Johor, the group recently launched Setia Eco Cascadia on a 259-acre site within the Tebrau Corridor.

For FY12, the group has plans for its Setia Eco Glades, Cyberjaya, which is sited on 268 acres of freehold land. Setia Eco Glades will consist of gated and guarded enclave with linked villas, semi-detached homes and bungalows.

In Penang, SP Setia's projects will include a high-rise development called Setia V Residences in Gurney, and Brook Residences comprising 11 bungalows on Brook Road in the upmarket Jesselton area.

In Singapore, the group will launch its maiden project, namely a high-rise condominium development called 18 Woodsville.

According to Liew, there were also plans to launch another phase for the group's Fulton Lane in Melbourne, Australia.

The EcoLakes and EcoXuan projects in Vietnam are also expected to help augment sales in FY12.

Liew said the group was also looking to acquire prime city land for development in Hanoi or Ho Chi Minh City.

“The Vietnam property market has slowed down tremendously. So, this is a good opportunity for us to acquire prime land in the city. So far, we are still talking.”

He reiterated that SP Setia was continuously on the lookout for prime city land in London and Singapore. “In central London, prime properties are still in high demand,” he said. “Even in Singapore, if we have the chance.”

Liew also expressed confidence that the group's 18 Woodsville development in Singapore would do well.

“Despite the recent 10% hike in stamp duty for foreigners buying private homes (in the island republic), we think that at least 30 to 50% of our sales in Singapore will be Malaysian buyers.”

By The Star

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