HEARTENED by the strong economic performance and good demand for property, especially residential units, developers are expecting stronger sales and earnings growth this year.
The low interest rate regime and government incentives for property purchase are also expected to boost sales.
Glomac Bhd group executive vice-chairman Datuk Richard Fong said that 2004 was expected to be a good year for most developers with the improvement in the stock market and the economy.
''The smooth transition in the country's leadership also augurs well for the industry and now we can all get back to business,'' he said.
Fong said that for Glomac, 2004 would be an important and exciting year with five projects to be launched in Kelana Jaya, Sungei Buloh and Puchong (all in Selangor).
''We hope to sell at least RM500mil worth of properties this year compared with about RM300mil last year. Glomac is on track to record stronger earnings growth of between 25% and 30% this financial year ending April 30,'' Fong told StarBiz in a telephone interview yesterday.
For its financial year ended April 30, 2003, Glomac recorded a 55% increase in net profit to RM29.6mil, on a 24.1% higher group turnover of RM212.7mil. Analysts have forecast net profits of between RM35mil and RM36mil for the group in the FY2004.
For its second quarter to October, the group recorded a 29% increase in net profit to RM10.5mil.
Sales for the quarter came to RM78.4mil compared with RM60.3mil a year ago, while pre-tax profit was RM15.3mil against RM11.8mil previously.
Fong said that buyers would also be taking advantage of the government's stimulus package, which included a waiver on stamp duty for purchase of houses priced below RM180,000 and valid until May 30 as well as current low bank interest rates.
About 70% of Glomac's projects, especially Saujana Utama in Sungei Buloh and Sri Saujana in Johor, comprise homes priced from RM140,000 to RM160,000.
Fong said the company's Aman Suria would be the major contributor to group earnings in FY2004, accounting for about 60% of group profits. The first phase of Aman Suria, worth RM255mil, consisting of double-storey terraced houses and bungalows, was sold out.
The new launch at Aman Suria in April or May will be the bungalow series. With built-up areas of about 4,500 sq ft, the bungalows will be priced from RM1.5mil to RM2mil each.
In June, the group will team up with KJ Leisure to develop 9.5 acres in Kelana Jaya into lakeside bungalows priced at about RM1.5mil to RM2mil.
Fong said a commercial development in Kelana Jaya, featuring about 100 three- and four-storey shop-houses priced around RM1mil each, had also been planned.
Glomac will also be teaming up with Score Option Sdn Bhd to develop 90 acres, behind Tesco hypermarket in Puchong, into double-storey terraced and semi-detached houses for launch in May. The 1,800-sq-ft terraced houses will be priced from RM200,000 to RM250,000 and the 3,300-sq-ft semi-detached units at around RM600,000.
The project, to be undertaken over four years, was expected to make significant contributions in FY2005.
According to Sunway City Bhd (SunCity) managing director Datuk Wong Choon Kee, 2004 and 2005 will be good for the property industry, barring unforeseen circumstances.
''Consumer confidence has been boosted by the stable leadership, the improving economy, and low interest rates which are expected to continue for some time,'' he said.
Wong said more people were also upgrading their homes and this had contributed to the good take-up of high-end houses, especially in the Klang Valley.
''Even shop-houses in good locations have reported good sales in the last three to four months. In the recent launch of our Sunway Damansara shop-houses, about 90% of the 96 units were sold. The three-storey, 6,500-sq-ft units were priced at about RM1mil each,'' he said.
In its financial year ending Dec 31, SunCity will be launching RM1bil worth of properties, of which 95% will be residential units.
''We expect to generate between RM650mil and RM700mil in sales compared with about RM500mil last year. Of this, about 60% will be high-end homes priced from RM500,000 to RM4mil a unit,'' Wong said.
He said the ''very high end'' signature residential enclave in Mont'Kiara – the Kiara Hills – with over RM1bil in gross development value, will be launched in April.
Phase one will feature 88 bungalows having about 6,500 sq ft of built-up area and priced between RM4mil and RM5mil. There will also be 33 courtyard homes of about 4,000 sq ft, priced from RM1.75mil to RM2mil.
LBS Bina Group Bhd is also bullish about charting stronger earnings growth in its current financial year ending Dec 31.
Managing director Datuk Lim Hock San said the group expected sales to rise to RM600mil from RM520mil last year. About half the sales will be from its flagship development in Bandar Saujana Putra, next to the USJ/Putra Heights township.
''Our latest launch, Taman Simpang Setia in Taiping, Perak, during the Chinese New Year achieved sales of RM36mil. This says a lot about the market. Frankly, we were quite surprised by the overwhelming response,'' he said.
Lim said more than 8,000 mixed properties with a gross development value of RM1.1bil would be launched this year. Of the total, about 3,500 units will be sited in Bandar Saujana Putra.
Source : The Star 03/02/2004 | 
