by AZALEA AZUAR / pic credit: OCRGroupBhd FB
OCR Group Bhd is in the final stage of negotiations in acquiring two projects in the Klang Valley worth more than RM850 million as the developer makes good progress with its existing affordable homes development in Kuantan, Pahang.
MD Billy Ong Kah Hoe said the group plans to launch four projects worth more than RM700 million in the next 24 months.
The proposed projects are the Vertex in Pahang, Boulevard Gardens, and Tiara Bangi homes in Selangor and a hotel and a block of service apartments in the central Melaka district.
These proposed projects come on the heels of OCR announcing its Priya Kuantan development which is scheduled to be completed in the first half of 2022 and its maiden project Isola KLCC.
The Priya Kuantan project, which began in the first quarter of 2019 (1Q19), is a 50:50 joint venture between OCR’s subsidiary OCR Properties (Kuantan) Sdn Bhd and Yayasan Pahang to develop the 100-acre (40.47ha) land in Kuantan.
Priya Kuantan has a RM166 million gross development value and consists of 978 units (20’ x 70’) of single-storey terrace houses and 146 units (40’ x 80’) of single-storey semi-detached homes with prices starting from RM137,000.
The affordable homes project is OCR’s first development of a mass scale and has registered sales of RM102.5 million at the end of March with a 90% booking rate.
“This speaks volume of the demand for our value-accretive properties, which provides spacious homes at modest prices.
“In response to the robust demand, we accelerated the construction progress for Priya Kuantan and are committed to handover the units in early 2022. As at March 31, 2021, we completed over 40% of the development despite multiple hurdles we encountered in 2020,” Ong stated in a reply to The Malaysian Reserve.
The residential development Isola KLCC comes under its Luxury Living label and is built on a 0.4-acre land with a take-up rate of more than 80% as of end-March.
The Mate project has also received a strong response with over 80% of the launched units taken up and has unbilled sales of RM11.1 million.
OCR also plans to bolster the group’s income stream through its construction and Project Management Consultancy arms.
“We want to leverage on our in-house construction team to bid for government or private projects if we have extra resources,” said Ong.
OCR’s associated, Taraf Raya Sdn Bhd, has entered into a memorandum of understanding with Malaysia Rail Link Sdn Bhd and China Communications Construction Sdn Bhd (CCC) to undertake project works on the East Coast Rail Link (ECRL) project in Pahang.
Unfortunately, Ong said the rise of Covid-19 cases and the northern realignment of the ECRL line have slowed down the talks on the project management consultation arrangement.
“We are still working closely with MRL and CCC to ensure the local content thresholds are met throughout the implementation of the project,” he said.
OCR’s current unbilled sales and construction orderbook amounting to RM393 million could sustain its earnings until 2023.
The company continues to assess the demand in the property market and will adjust its strategy and marketing accordingly.
It aims to improve its corporate branding and project visibility through participation in various public and social media platforms.
“The company aims to expand the brand awareness of OCR and hope that within five years, the brand becomes synonymous with unique and innovative homes to every Malaysian,” Ong explained.
He added the company is on the lookout to secure land in up-and-coming hotspots in Malaysia to broaden its geographical footprint and increase product offerings.
“We aim to leverage on our lean balance sheet and healthy net gearing position of 0.35 times as at end-2020 to acquire potential value-accretive land,” he noted.
Ong acquired a controlling stake in Takaso Resources Bhd which had reported losses for over 10 consecutive years and changed its entire business from manufacturing to property development and construction.
“The name changes to OCR Group signified this. We launched Isola KLCC to kick start our journey into the group’s next phase as a listed entity. As part of the streamlining exercise to enhance OCR’s financial performance, we disposed of the two loss-making subsidiaries managed by Takaso Resources previously in 2018,” he said.
OCR shares closed half a sen lower at 20 sen yesterday, valuing the developer at RM112.4 million.