SD Property plans to offer more mid-range products

By SHAHEERA AZNAM SHAH / Pic By MUHD AMIN NAHARUL

SIME Darby Property Bhd (SD Property) is positive on the prospect of the domestic property market this year amid the flattish outlook anticipated by industry players.

Its group MD Datuk Azmir Merican Azmi Merican (picture) said due to market uncertainties, SD Property will be focusing on rolling out suitable products which have been identified to gain interest during the Covid-19 pandemic.

“In terms of product launches, we are reaching the level of where we were in 2019 and we feel the market is ready.

“What we have learnt from 2020 is that the right products will continue to sell, and we will continue to do that and replenish our unbilled sales,” he said in a virtual press conference last Friday.

Azmir Merican said for SD Property’s financial year 2021 (FY21), the developer will be focusing on rolling out medium-range products with prices between RM500,000 and RM750,000, which occupy 52% of the group total launches for the year.

“What will be driving these launches are the government’s initiative to continue the Home Ownership Campaign, the low Overnight Policy Rate and full stamp duty exemption,” he added.

Azmir Merican said based on SD Property’s track record, landed residential has continued attracting interest from buyers and will comprise 43.3% of the developer’s total units launched in FY21.

For its current financial year, SD Property plans to roll out several projects with a total gross development value (GDV) of RM2.5 billion, consisting of high-rise residentials, landed industrial buildings and lots, as well as commercial development in addition to landed residential.

Among the developer’s strategic high-rise launches in the prime areas are the Parcel J of Kuala Lumpur Golf and Country Club, and units in Ara Damansara, which both are expected to be launched in the first half of this year (1H21).

SD Property is also planning to launch a high-rise residential in Putra Height in 2H21 with an estimated GDV between RM350 million and RM400 million.

This year, the developer is expecting to rake in total sales of RM2.4 billion from the overall launches, an optimistic target compared to its full-year revenue of RM2.1 billion in FY20.

Citing the industry’s sentiments, Azmir Merican believes the recovery in the residential property market will sit out for another year and begin to see progress in 2022.

“2021 is expected to look flattish as seen by the drop in both volume and value of residential transactions in the first nine months of 2020.

“For example, we saw units sold in Selangor were down by 19%, while the values down by 17%. Also, we do not expect foreign interests until Malaysia’s international border movement restrictions are lifted,” he said.

For its 4Q20, SD Property posted a net loss of RM55.93 million compared to a net profit of RM102.96 million a year ago.

It attributed the losses to lower contribution from its segments and an impairment loss from its stake in Battersea Project Holding Co Ltd and its subsidiaries in the period.

Revenue for the quarter fell to RM705.19 million versus RM888.93 million in 4Q19.