Revenue of property developer City Development Ltd (CDL) increased by 8.4% in Q1 2017 to S$ 783.8 mil from S$723.3 mil that was reported in a similar period in 2016 amid a challenging property market, revealed the 11 May SGX filing.
The rise in revenue is due to the better performance from the property development section, which recorded an increase in contribution of 33.9% by Gramercy Park’s strong take-up and handover of phase 1 units of Suzhou Hong Leong City Centre (HLCC).
However, there was a decline of 18.9% in net profit to S$ 85.5 mil in comparison to S$ 105.3 mil recorded in Q1 2016.
Various factors can be attributed to the declined net profit including the dull performance of Millennium & Copthorne Hotels plc and lack of contribution from Bartley Ridge as well as Echelon, the 2 joint venture projects completed in 2016.
Another cause is the lower revenue from the realization of a private property fund, Real Estate Capital Asia Partners investment, as well as exchange losses mainly from the repayment of an inter-company loan that is dominated in New Zealand dollar, under CDL Hospitality Trusts, a direct subsidiary of the group.
In early May, CDL won the tender of a residential site at Tampines Avenue 10 with leasehold of 99 years after it bid S$370.1 mil. The group plans to develop a condominium of 15-storey and about 800 units.
CDL also intends to launch New Futura in 2H 2017. The 124-unit freehold luxury development comprises of 2 towers with 36-storey.
(Artist's Impression of New Futura)
“The housing market in Singapore is starting to portray some recovery signs,” said Kwek Leng Beng, CDL Executive Chairman.
He added that property prices, you could see it more obviously in the luxury market, seem to be stabilizing due to more investors’ confidence as our country continues to be a safe place in a marketplace that is highly volatile.
“Recent relaxations in policy are calculated and prudent and are in support of the goal purchasing property as a long term investment. We have confidence that the government of Singapore will keep on monitoring closely the market conditions and tweak property cooling measures as needed,” added Kwek.